Suppose Fred's wage-schooling relationship is given by Years of Schooling Earnings 9 $28,000 10 $31,150 11 $33,700 12 $35,900 13 $37,400 14 $38,500 Derive the marginal rate of return schedule. When will Fred quit school if his discount rate is 5 percent? What if the discount rate is 10 percent?
Suppose Fred's wage-schooling relationship is given by Years of Schooling Earnings 9 $28,000 10 $31,150 11 $33,700 12 $35,900 13 $37,400 14 $38,500 Derive the marginal rate of return schedule. When will Fred quit school if his discount rate is 5 percent? What if the discount rate is 10 percent?
Chapter8: Market Failure
Section: Chapter Questions
Problem 9P
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Suppose Fred's wage-schooling relationship is given by
Years of Schooling | Earnings |
9 | $28,000 |
10 | $31,150 |
11 | $33,700 |
12 | $35,900 |
13 | $37,400 |
14 | $38,500 |
Derive the marginal
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