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ypes of people: A, B, and C. Types are not ea: ves their proportion in population and their p vage for all types is $150,000 (same for IB an A opulation 25% B 50% C 25%

ypes of people: A, B, and C. Types are not ea: ves their proportion in population and their p vage for all types is $150,000 (same for IB an A opulation 25% B 50% C 25%

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Incorrect Question 7 There are three types of people: A, B, and C. Types are not easily discernible. The following table gives their proportion in population and their productivities. Suppose that the market wage for all types is $150,000 (same for IB and CB). Percent of the population 25% Productivity at Investment Bank (IB) Productivity at Commercial Bank (CB) Investment Bank Commercial Bank A Both Neither 100,000 100.000 B 50% 200,000 160,000 C Suppose there is a screening technology that can identify the type. Screening cost is $ 10,000/person. Both the IB and CB are planning to interview 40 workers. Then which bank(s) should use screening in hiring? 25% 300,000 180,000
Transcribed Image Text:Incorrect Question 7 There are three types of people: A, B, and C. Types are not easily discernible. The following table gives their proportion in population and their productivities. Suppose that the market wage for all types is $150,000 (same for IB and CB). Percent of the population 25% Productivity at Investment Bank (IB) Productivity at Commercial Bank (CB) Investment Bank Commercial Bank A Both Neither 100,000 100.000 B 50% 200,000 160,000 C Suppose there is a screening technology that can identify the type. Screening cost is $ 10,000/person. Both the IB and CB are planning to interview 40 workers. Then which bank(s) should use screening in hiring? 25% 300,000 180,000
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