B. Mark is about to graduate from college. After applying to jobs all over the country, Mark has just received 2 offers. The first offer is for a job in Des Moines, Iowa that pays $40,000. The second offer is for a job in Washington, D.C. that pays $50,000. The aggregate price level in Des Moines is $100, while the aggregate price level in Washington, D.C. is $200. 1. Calculate Mark's real income in each city. Assuming Mark takes the offer that maximizes his real value of income, which city will Mark head to next year? 2. In words, describe the meaning of 'real value of income.' 3. What other factors might Mark consider in his decision-making process? Think beyond numbers.

B. Mark is about to graduate from college. After applying to jobs all over the country, Mark has just received 2 offers. The first offer is for a job in Des Moines, Iowa that pays $40,000. The second offer is for a job in Washington, D.C. that pays $50,000. The aggregate price level in Des Moines is $100, while the aggregate price level in Washington, D.C. is $200. 1. Calculate Mark's real income in each city. Assuming Mark takes the offer that maximizes his real value of income, which city will Mark head to next year? 2. In words, describe the meaning of 'real value of income.' 3. What other factors might Mark consider in his decision-making process? Think beyond numbers.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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