Suppose the rural wage is $3 per day. Urban modern sector employment can be obtainedwith 0.4 probability and pays $8 per day. Using this information, what would be the rationaldecision of rural population?1) since urban wage rates are much higher than the rural wages, they encourage people tomigrate in spite of high level of unemployment.2) people would be indifferent between migrating or staying3) people are rational; the high unemployment rate would reduce their rural-to-urbanmigration.4) since people are risk neutral, it would be rational not to migrate in order to avoid risks.

The key reasons are:The urban modern sector wage ($8 per day) is significantly higher than the rural…

Answered: Suppose the rural wage is $3 per day.…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Follow-up questions. d. Let D be the difference in marginal product between an experienced worker and a new worker (MPe − MPn). Suppose that robust, experienced workers would prefer not to pool with sickly workers at their firm, and so they seek out a new job with an employer who does not offer health insurance. What will be the wage of the robust worker at the new job during the first year there? Keep in mind, these workers will no longer be experienced because they will be adapting to a new firm. Under what conditions will it make financial sense for the robust worker to change jobs? Your answer should be an inequality that includes D, θ, Vr, and Vs. e. D is a measure of job-specific human capital; as workers learn the job, they become more productive so D > 0. However, not every job or industry has the same value for D. In some lines of work D is low, while in others D is high, simply because of the nature of the work. Given the results, you have seen in this problem, in which…
consider the following two proposals to reform unemployment insurance. Explain the argument for and against each reform. (a) The insurance payment would be increased so that it replaced 100% of a worker's regular labor income for 26 weeks. (b) Each worker would be paid a lump sum equal to 10 weeks of his or her labor income at the start of the spell of unemployment. there would then be no other payments.
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
Fatima has decided to work for an entrepreneur in Italy because the country's high entrepreneurship rate provides her employment protection and strong unemployment insurance ( a) True ( b) False
What types of empirical studies (across-state studies or national studies) does the author prefer, and why? National studies are better because across-state studies are more subject to statistical fluctuation. Across-state studies are better because they are less susceptible to the effects of business cycles National studies are better because across-state study results may not necessarily reflect the effect of increases in the minimum wage on the nation as a whole Across-state studies are better for measuring age-specific implications than national studies.
Please explain to me what every different variable means in this question
Consider an individual aged 64 who is eligible to collect full social security (public pension) benefits of $6,000 for a year. They have no other income but can work at a weekly wage rate of $600 for a maximum of 52 weeks. Receipt of benefits from the social security program is retirement tested. Specifically, the individual can earn up to $9,000 in annual wage income without a reduction in benefits; however, after $9,000 of earnings, benefits are reduced by 50% for every dollar earned, until the benefits are exhausted. a) Carefully draw and label the budget constraint for this individual. b) Suppose previously there was a retirement test, and then the test is eliminated, i.e., the individual now is allowed to keep all benefits, irrespective of their labour earnings. How would this affect the individual’s labour supply? Question Two David is a 70-year-old accountant. After serving his accounting firm for 45 years, David decides to retire soon. David has great passion for vintage cars…
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Gerhart & Newman (2020) discuss how compensation (pay) may be a measure of justice, i.e., gender, race, culture, etc. They further state that stockholders are interested in executive pay. Why does it matter, and how is it fixed? How risky are these decisions to employee retention?
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