Suppose Firm A and Firm B hire only women. That is:W(1 + da) < Wmand WF(1 + d) < WM-If the discrimination coefficient is higher for Firm A than Firm B (da >de), then which of the following statements is correct?АA. Firm A will hire more women than Firm B.B. Firm B will hire more women than Firm A.C. Both firms will hire the same number of women.

Labor discrimination, also known as employment discrimination, refers to unfair or unjust treatment…

Answered: Suppose Firm A and Firm B hire only…

Principles of Microeconomics (MindTap Course List)

8th Edition

ISBN:9781305971493

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter18: The Markets For The Factor Of Production

Section: Chapter Questions

Problem 3PA

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10 4. Assume that we are analyzing employer-based discrimination and that there are two groups of workers, group A and group B. These workers are perfect substitutes. The firm's production function is given by q = 20√√EA + EB. This production function implies that the marginal product of labor equals MP = The wage for group workers is $20, the wage for group A workers is $25, and the price of output equals $100. a. If this firm were non-discriminatory, then how many workers would the firm hire and what would profits equal? B √EA+EB b. If the employer discriminated against workers from group B and had a discrimination coefficient equal to 0.85, then how many workers would the firm hire and what would profits equal? c. Given the discrimination coefficient in part (b), what do you expect to happen to this firm in the long-run and why?
Refer to the following diagram that shows the labor demand for a monopolistic firm hiring labor from a competitive labor market. Wage W₂ W₁ 2. A 1. B MRP с Q₁ Q₂ The allocatively efficient level of employment for this firm is given by some amount greater than Q 2. some amount between Q 1 and Q 2. S VMP Labor
Four (TYPE I) firms sell Product X in competitive markets at a price of 10. They each operate with the production function: x = 100L – L². Another firm with monopoly power (TYPE II) sells faces demand curve P = 160 – Y and has production function Y = 5L. All five firms hire as wage-takers in the same market where labour supply is w = 2L. Illustrate and quantify the equilibrium wage and the number of workers hired by each firm. а. Solve for the equilibrium wage and employment by each firm. b. Provide a 3-panel diagram. 6.
Suppose the owners of Firm A and Firm B hire only women because: W(1 + da) da), then which firm will earn higher profits? A. Firm A will earn higher profits. B. Firm B will earn higher profits. C. Both firms will earn the same profits.
Explain the discrimination coefficient.
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If employers are profit-maximizers, then O competition will always eventually eliminate employment discrimination. O employment discrimination may persist if consumers discriminate. O employment discrimination will persist because it is always profitable. O compensating differentials carinot exist.
Two firms compete for hiring workers in the labour market.The equilibrium wage is w = alpha + beta(H1 + H2), where alpha, beta; > 0 are parameters,and Hi is the number of workers hired by firm i = 1; 2. Firm i's profit is(y - w) Hi, where y is the output per worker. Assume y > alpha . Firm i choosesHi to maximize its profit. Do the following: (a) Consider the two firms decideon Hi simultaneously. Derive the Nash equilibrium. (b) Consider the twofirms make decisions sequentially. Firm 1 gets to hire first, followed by firm2. Derive the subgame perfect equilibrium
Consider the following graph facing a monopsonist. If this firm is a profit maximizer, it would pay what wage, w, and hire how many, L, workers? a. w=$16.50;L=47. b. w=$13;L=33. c. w=$22;L=33. d. w=$29;L=47. e. None of the above.?
6) Faced with 2 distinct functionsQ1 =24- 0.2P1 ; Q2 = 10 – 0.05P2 & TC =35 + 40Q where Q= Q1 + Q2What prices and quantities will the firm set a) with discrimination? b) Without discrimination? Find the profit earned in each case .Use MR=MC method to maximize profit and check second order conditions.

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