Q2) Samantha has an annual non-labour income of $5000. Suppose she has the to available time of 4160 hours per year. Samantha's wage rate is $15 per hour, and s chooses to work 2000 hours in a year. Suppose when Samantha's wage rate increas from $15 to $18 per hour, she will work 2040 hours. At $18 per hour, if she works 22 hours per year, she would be indifferent to her original work decision before the wag increase. a) Draw a diagram to show all the given information related to Samantha's w circumstances. Calculate all the relevant income levels and label them in the gra b) Calculate Samantha's income effect, substitution effect and total effect related to wage increase. Show them in the diagram.

Q2) Samantha has an annual non-labour income of $5000. Suppose she has the to available time of 4160 hours per year. Samantha's wage rate is $15 per hour, and s chooses to work 2000 hours in a year. Suppose when Samantha's wage rate increas from $15 to $18 per hour, she will work 2040 hours. At $18 per hour, if she works 22 hours per year, she would be indifferent to her original work decision before the wag increase. a) Draw a diagram to show all the given information related to Samantha's w circumstances. Calculate all the relevant income levels and label them in the gra b) Calculate Samantha's income effect, substitution effect and total effect related to wage increase. Show them in the diagram.

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

Thanks for the response. Can you give a real work example of it
In order to make a replacement decision, a firm calculated the equivalent annual cost of owning an asset as follows: EUAC Annual EUAC Replacement Capital Repair Repair Period Costs Costs Costs 1 2 3 4 5 $1,287- $1,082 $400 $189 $976 $600 $298 in 1 year $812 $800 $437 $673 $1,200 $592 When should the company replace the equipment? in 2 years O in 4 years in 5 years in 3 years
Taylor's nominal income is $50,000 per year in Acity where the cost-of-living index is 200. Taylor is considering accepting a similar job and relocating to Becity where the cost-of- living index is 210. For Taylor's income to have the same purchasing power in Becity as $50,000 has in Acity, then Taylor's nominal income per year in Becity must equal: Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a $50,000. b $52,100. C $52,500. d. $55,000.
What do economists mean by "deminishing returns" to an input? What causes diminishing returns? Where would one observe this principle at a job and the real world?
Ht
A worker receives CAD 3,000 of lump-sum transfers from the government annually andhas 4,160 available hours per year. She is currently working 2,200 hours per year at the wage rateof CAD 20.00 per hour. After being promoted, her wage rate increases to CAD 25.00 per hour,and she decides to work 2,700 hours. She is indifferent between her original work decision andworking 2,850 hours at CAD 25.00 per hour.1. What is the compensated wage elasticity of labor supply implied by her response to thewage increase? Is the compensated labor supply elastic or inelastic?2. What is the uncompensated wage elasticity of labor supply implied by her response to thewage increase? Is the uncompensated labour supply elastic or inelastic?3. Why are these elasticities different?
Given the function X=(4K)^1/3(L)^2/3 where both capital K and labor Lare functions of z. Solve dX/dz in detail.
1
Suppose that this conveyor-manufacturing firm has another location and would like you to evaluate the input mix decisions at this new location. Here is all you know about the newlocation. The marginal rate of technical substitution is currently 0.5. The marginal product of labor at its target level of output is 60 rollers per hour. What is the marginal product of capital? Ifthe rental rate for capital is $24 per hours at this location and the wage paid to labor is $12 per hour, could this location be minimizing the costs of producing its target level of output? Explain briefly.
M d. The marginal product of labour is zero beyond 15 hours. Imagine that you work for 40 hours per week at the wage rate of £10 an hour. Your free hours are defined as the number of hours not spent in work per week, which in this case iS 24 hours x 7 days - 40 hours 128 hours per week Suppose now that your wage rate has increased by 100%. If you want to keep your total weekly income constant, then: Select one or more: Your total number of hours will fall by 25%. O a. O b. Your total number of hours will fall by 50%. You will work 25 hours per week. C. O d. Your free time will increase by 25%. 因口五 0 ASUS ZenBook
Q24. The following table gives the marginal product schedule of labour. It is also given that the total product of labour is zero at zero level of employment. Calculate the total and average product schedules of labour. L (units) MP (units) 1 3 5 6. 3575 31
hedule detailing the weekly total production of per week, and the cost of each unit of capital is tz uolzsano C