Maria earns $12 per hour in her current job and works 35 hours a week. Her disutility of effort is equivalent to a cost of $2 per hour of work. If she loses her job, she will receive unemployment benefit equivalent to $6 per hour. Additionally, being unemployed has psychological and social costs equivalent to $1 per hour. Then: a. The employment rent per hour is $5 b. Maria's reservation wage is $6 per hour. c. Maria's employment rent if she can get another job with the same wage rate ($12) after 44 weeks of being unemployed is less than her employment rent if she can only get a job at a lower wage rate after 44 weeks of being unemployed. FALSE
Maria earns $12 per hour in her current job and works 35 hours a week. Her disutility of effort is equivalent to a cost of $2 per hour of work. If she loses her job, she will receive unemployment benefit equivalent to $6 per hour. Additionally, being unemployed has psychological and social costs equivalent to $1 per hour. Then: a. The employment rent per hour is $5 b. Maria's reservation wage is $6 per hour. c. Maria's employment rent if she can get another job with the same wage rate ($12) after 44 weeks of being unemployed is less than her employment rent if she can only get a job at a lower wage rate after 44 weeks of being unemployed. FALSE
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
![Maria earns $12 per hour in her current job and works 35 hours a week. Her disutility of effort is equivalent to a cost of $2 per
hour of work. If she loses her job, she will receive unemployment benefit equivalent to $6 per hour. Additionally, being
unemployed has psychological and social costs equivalent to $1 per hour. Then:
a. The employment rent per hour is $5
b. Maria's reservation wage is $6
per hour.
c. Maria's employment rent if she can get another job with the same wage rate ($12) after 44 weeks of being unemployed is less
than her employment rent if she can only get a job at a lower wage rate after 44 weeks of being unemployed. FALSE](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc6c795d6-1b37-42da-bfe7-b50b121bcfeb%2F5e373ac2-8f55-4932-82b6-431e6cbdf6a7%2Fbf117y_processed.png&w=3840&q=75)
Transcribed Image Text:Maria earns $12 per hour in her current job and works 35 hours a week. Her disutility of effort is equivalent to a cost of $2 per
hour of work. If she loses her job, she will receive unemployment benefit equivalent to $6 per hour. Additionally, being
unemployed has psychological and social costs equivalent to $1 per hour. Then:
a. The employment rent per hour is $5
b. Maria's reservation wage is $6
per hour.
c. Maria's employment rent if she can get another job with the same wage rate ($12) after 44 weeks of being unemployed is less
than her employment rent if she can only get a job at a lower wage rate after 44 weeks of being unemployed. FALSE
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