Imagine a rural area with a current wage rate of $20 at which 1500 workers are employed and 500 are unemployed. A government project will hire 50 workers at the going wage rate. Assume reservation wages for those hired are more or less uniformly distributed between $2 and $20. The METB is 0.2. Estimate the expected opportunity cost of project labor.

Imagine a rural area with a current wage rate of $20 at which 1500 workers are employed and 500 are unemployed. A government project will hire 50 workers at the going wage rate. Assume reservation wages for those hired are more or less uniformly distributed between $2 and $20. The METB is 0.2. Estimate the expected opportunity cost of project labor.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

A college education will more than likely lead to a higher lifetime stream of earnings (all things being equal) for those who obtain one. True False
1
The company manufactures game tables which are sold for $60 each. To produce each game table, the company incurs $28 of variable costs and $12 of allocated fixed costs. A buyer in Puerto Rico offers to purchase 3,000 tables at $36 each. The Restoration Hardware Company has excess capacity and can handle the additional production. What effect will acceptance of the offer have on net income?
Actual labor cost (payroll) for $ 20,000 June Labor rate variance $ 4,000 favorable Labor efficiency variance. $ 2,400 unfavorable Actual direct labor hours 1,000 worked (AQ) Total standard direct labor cost for the output in June (to the nearest dollar) was:
All of the following are legal rights provided to the employee and enlisted in the Lebanese Labor Law, except 36 consecutive hours as weekly rest 10 weeks as maternity leave 15 days as annual leave 4 days as bereavement leave
A company has 350 employees who work 120 hours a month each. Each worker earns $21 per hour. There is a profitable project the company would like to start, but it would require an additional 21,000 working hours within three months to be completed, and all the employees are fully loaded with other projects. The company does not want to hire new staff; they would like the project to be completed by the current workforce instead.Given that the wage elasticity of labor supply is 0.8, calculate the hourly wage the company should offer its employees to encourage them to work on the new project. Use the midpoint method and round to two decimal places throughout your calculations.
Many Norwegian students reduce the scope of paid work towards the end of the semester because: O They are tired towards the end of the semester O The real hourly wage is lower towards the end of the semester O Their alternative value of time is higher than earlier in the semester O The Norwegian loan and scholarship schemes for students are favorable
Minimization CT = W1X1 + W2X2 Hold it: Y = X11/3 X21/6 where X1 and X2 are the productive factors and W1 and W2 are their prices, respectively. Determine: If X2 = 27 and W2 = 2 a) The short-run cost function
25
Boeing created, and recently expanded, an airplane manufacturing center in Charleston, South Carolina. One of the factors that likely influenced this location decision is that South Carolina is a "right to work" state. This represents a) a place factor related to labor. b) a transportation factor related to the market. c) higher wages for Boeing workers in South Carolina relative to Washington. d) a place factor related to the political environment.
The form of economics most relevant to managerial decision-making within the firm is:
The productivity of an input is the Group of answer choices net worth of the input. sum of the total output produced by all inputs. amount of output produced per unit of input. per capita cost of an input.