To calculate the total hours per week and the reasons quantity supplied increases with the hourly wage and the individuals who have a backward bending supply curve and whether the market supply curve would bend backwards in the table shown below. Concept Introduction: Wage rates: The amount of base wage paid to a worker per hour or day or per unit of output if on piecework Market supply curve: this is an upward sloping curve depicting the positive relationship between price and quantity supplied

Question

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Answer 1

Question

Chapter 12, Problem 1.1P

To determine

To calculate the total hours per week and the reasons quantity supplied increases with the hourly wage and the individuals who have a backward bending supply curve and whether the market supply curve would bend backwards in the table shown below.

Concept Introduction:

Wage rates: The amount of base wage paid to a worker per hour or day or per unit of output if on piecework

Market supply curve: this is an upward sloping curve depicting the positive relationship between price and quantity supplied

Expert Solution & Answer

Explanation of Solution

From the data given in the table, we can determine the total hours of labor hours supplied by,

Hourly wage $	Q₁	Q₂	Q₃	Q_T
15	20	0	0	35
16	25	0	0	41
17	35	10	0	62
18	45	25	10	98
19	42	40	30	131
20	38	37	45	140

Here, the quantity supplied will tend to increase with an increase in the hourly wage because every additional unit of labor supplied will now earn more than the earlier level.

To understand the backward bending nature of labor supply, we see that the individuals Q₁and Q₂will show a backward bending supply curve in the range shown as we can clearly see that with an increase in the hourly wage after a point, there is a reduction in the hours of work performed.

The market supply of labor does not show a backward bending supply curve of labor which can be assessed from the column Q_T.

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5. Download the Excel sheet from Brightspace. The data contains the GDP per capita and GNI per capita of OECD member countries in 2014 (both figures are reported in US dollars). The countries are ranked by GDP per capita. a. Compute the ratio of GNI to GDP for each country (GNI per capita/GDP per capita). What does this imply about net factor income from abroad for each country? b. Rank the countries based on the GNI/GDP ratio, starting with the country with the highest ratio and ending with the country with the lowest ratio. Which country has the highest ratio, and which has the lowest? c. Comment on why the countries you identified in the previous question have a large difference between GDP and GNI? What does the difference imply?

3. Answer the following questions about external wealth. a. Home has external wealth of $100 million in period t. In t+1, Home purchases $160 million foreign assets, and Foreign purchases $120 million in Home assets. Assume a world interest rate of 10% per annum. Compute the "change" in external wealth at t+1 for Home. b. A country's external wealth was -$1.5 billion at the end of 2015, and its trade balance was $750 million in 2016. Assume the world interest rate is 5% per annum. What is the "value" of a country's external wealth at the end of 2016?

Answer 2

Question

Chapter 12, Problem 1.1P

To determine

To calculate the total hours per week and the reasons quantity supplied increases with the hourly wage and the individuals who have a backward bending supply curve and whether the market supply curve would bend backwards in the table shown below.

Concept Introduction:

Wage rates: The amount of base wage paid to a worker per hour or day or per unit of output if on piecework

Market supply curve: this is an upward sloping curve depicting the positive relationship between price and quantity supplied

Expert Solution & Answer

Explanation of Solution

From the data given in the table, we can determine the total hours of labor hours supplied by,

Hourly wage $	Q₁	Q₂	Q₃	Q_T
15	20	0	0	35
16	25	0	0	41
17	35	10	0	62
18	45	25	10	98
19	42	40	30	131
20	38	37	45	140

Here, the quantity supplied will tend to increase with an increase in the hourly wage because every additional unit of labor supplied will now earn more than the earlier level.

To understand the backward bending nature of labor supply, we see that the individuals Q₁and Q₂will show a backward bending supply curve in the range shown as we can clearly see that with an increase in the hourly wage after a point, there is a reduction in the hours of work performed.

The market supply of labor does not show a backward bending supply curve of labor which can be assessed from the column Q_T.

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Answer 3

Question

Chapter 12, Problem 1.1P

To determine

To calculate the total hours per week and the reasons quantity supplied increases with the hourly wage and the individuals who have a backward bending supply curve and whether the market supply curve would bend backwards in the table shown below.

Concept Introduction:

Wage rates: The amount of base wage paid to a worker per hour or day or per unit of output if on piecework

Market supply curve: this is an upward sloping curve depicting the positive relationship between price and quantity supplied

Expert Solution & Answer

Explanation of Solution

From the data given in the table, we can determine the total hours of labor hours supplied by,

Hourly wage $	Q₁	Q₂	Q₃	Q_T
15	20	0	0	35
16	25	0	0	41
17	35	10	0	62
18	45	25	10	98
19	42	40	30	131
20	38	37	45	140

Here, the quantity supplied will tend to increase with an increase in the hourly wage because every additional unit of labor supplied will now earn more than the earlier level.

To understand the backward bending nature of labor supply, we see that the individuals Q₁and Q₂will show a backward bending supply curve in the range shown as we can clearly see that with an increase in the hourly wage after a point, there is a reduction in the hours of work performed.

The market supply of labor does not show a backward bending supply curve of labor which can be assessed from the column Q_T.

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Answer 4

Question

Chapter 12, Problem 1.1P

To determine

To calculate the total hours per week and the reasons quantity supplied increases with the hourly wage and the individuals who have a backward bending supply curve and whether the market supply curve would bend backwards in the table shown below.

Concept Introduction:

Wage rates: The amount of base wage paid to a worker per hour or day or per unit of output if on piecework

Market supply curve: this is an upward sloping curve depicting the positive relationship between price and quantity supplied

Expert Solution & Answer

Explanation of Solution

From the data given in the table, we can determine the total hours of labor hours supplied by,

Hourly wage $	Q₁	Q₂	Q₃	Q_T
15	20	0	0	35
16	25	0	0	41
17	35	10	0	62
18	45	25	10	98
19	42	40	30	131
20	38	37	45	140

Here, the quantity supplied will tend to increase with an increase in the hourly wage because every additional unit of labor supplied will now earn more than the earlier level.

To understand the backward bending nature of labor supply, we see that the individuals Q₁and Q₂will show a backward bending supply curve in the range shown as we can clearly see that with an increase in the hourly wage after a point, there is a reduction in the hours of work performed.

The market supply of labor does not show a backward bending supply curve of labor which can be assessed from the column Q_T.

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Answer 5

Chapter 12, Problem 1.1P

To determine

To calculate the total hours per week and the reasons quantity supplied increases with the hourly wage and the individuals who have a backward bending supply curve and whether the market supply curve would bend backwards in the table shown below.

Concept Introduction:

Wage rates: The amount of base wage paid to a worker per hour or day or per unit of output if on piecework

Market supply curve: this is an upward sloping curve depicting the positive relationship between price and quantity supplied

Expert Solution & Answer

Explanation of Solution

From the data given in the table, we can determine the total hours of labor hours supplied by,

Hourly wage $	Q₁	Q₂	Q₃	Q_T
15	20	0	0	35
16	25	0	0	41
17	35	10	0	62
18	45	25	10	98
19	42	40	30	131
20	38	37	45	140

Here, the quantity supplied will tend to increase with an increase in the hourly wage because every additional unit of labor supplied will now earn more than the earlier level.

To understand the backward bending nature of labor supply, we see that the individuals Q₁and Q₂will show a backward bending supply curve in the range shown as we can clearly see that with an increase in the hourly wage after a point, there is a reduction in the hours of work performed.

The market supply of labor does not show a backward bending supply curve of labor which can be assessed from the column Q_T.

Answer 6

Chapter 12, Problem 1.1P

To determine

To calculate the total hours per week and the reasons quantity supplied increases with the hourly wage and the individuals who have a backward bending supply curve and whether the market supply curve would bend backwards in the table shown below.

Concept Introduction:

Wage rates: The amount of base wage paid to a worker per hour or day or per unit of output if on piecework

Market supply curve: this is an upward sloping curve depicting the positive relationship between price and quantity supplied

Expert Solution & Answer

Explanation of Solution

From the data given in the table, we can determine the total hours of labor hours supplied by,

Hourly wage $	Q₁	Q₂	Q₃	Q_T
15	20	0	0	35
16	25	0	0	41
17	35	10	0	62
18	45	25	10	98
19	42	40	30	131
20	38	37	45	140

Here, the quantity supplied will tend to increase with an increase in the hourly wage because every additional unit of labor supplied will now earn more than the earlier level.

To understand the backward bending nature of labor supply, we see that the individuals Q₁and Q₂will show a backward bending supply curve in the range shown as we can clearly see that with an increase in the hourly wage after a point, there is a reduction in the hours of work performed.

The market supply of labor does not show a backward bending supply curve of labor which can be assessed from the column Q_T.

Answer 7

Chapter 12, Problem 1.1P

To determine

To calculate the total hours per week and the reasons quantity supplied increases with the hourly wage and the individuals who have a backward bending supply curve and whether the market supply curve would bend backwards in the table shown below.

Concept Introduction:

Wage rates: The amount of base wage paid to a worker per hour or day or per unit of output if on piecework

Market supply curve: this is an upward sloping curve depicting the positive relationship between price and quantity supplied

Answer 8

Expert Solution & Answer

Explanation of Solution

From the data given in the table, we can determine the total hours of labor hours supplied by,

Hourly wage $	Q₁	Q₂	Q₃	Q_T
15	20	0	0	35
16	25	0	0	41
17	35	10	0	62
18	45	25	10	98
19	42	40	30	131
20	38	37	45	140

Here, the quantity supplied will tend to increase with an increase in the hourly wage because every additional unit of labor supplied will now earn more than the earlier level.

To understand the backward bending nature of labor supply, we see that the individuals Q₁and Q₂will show a backward bending supply curve in the range shown as we can clearly see that with an increase in the hourly wage after a point, there is a reduction in the hours of work performed.

The market supply of labor does not show a backward bending supply curve of labor which can be assessed from the column Q_T.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Ch. 12 - Prob. 1.1P Ch. 12 - Prob. 1.2P Ch. 12 - Prob. 1.3P Ch. 12 - Prob. 2.4P Ch. 12 - Prob. 3.5P Ch. 12 - Prob. 3.6P Ch. 12 - Prob. 3.7P Ch. 12 - Prob. 4.8P Ch. 12 - Prob. 4.9P Ch. 12 - Prob. 4.10P

Explanation of Solution

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Chapter 12 Solutions