Economics (Irwin Economics)
21st Edition
ISBN: 9781259723223
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Chapter 17, Problem 7DQ
To determine
Principal-agent problem.
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Complete the following labor supply table for a firm hiring labor competitively: LO17.2
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Brenda owns a construction company that employs bricklayers and other skilled tradesmen. Her firm’s MRP for bricklayers is $22.25 per hour for each of the first seven bricklayers, $18.50 for an eighth bricklayer, and $17.75 for a ninth bricklayer. Given that she is a price taker when hiring bricklayers, how many bricklayers will she hire if the market equilibrium wage for bricklayers is $18.00 per hour? a. Zero. b. Seven. c. Eight. d. Nine. e. More information is required to answer this question
Chapter 17 Solutions
Economics (Irwin Economics)
Ch. 17.3 - Prob. 1QQCh. 17.3 - Prob. 2QQCh. 17.3 - Prob. 3QQCh. 17.3 - Prob. 4QQCh. 17.A - Prob. 1ADQCh. 17.A - Prob. 2ADQCh. 17.A - Prob. 3ADQCh. 17.A - Prob. 4ADQCh. 17.A - Prob. 5ADQCh. 17.A - Prob. 1ARQ
Ch. 17.A - Prob. 2ARQCh. 17.A - Prob. 3ARQCh. 17.A - Prob. 4ARQCh. 17.A - Prob. 1APCh. 17.A - Prob. 2APCh. 17 - Prob. 1DQCh. 17 - Prob. 2DQCh. 17 - Prob. 3DQCh. 17 - Prob. 4DQCh. 17 - Prob. 5DQCh. 17 - Prob. 6DQCh. 17 - Prob. 7DQCh. 17 - Prob. 8DQCh. 17 - Prob. 9DQCh. 17 - Prob. 10DQCh. 17 - Prob. 1RQCh. 17 - Prob. 2RQCh. 17 - Prob. 3RQCh. 17 - Prob. 4RQCh. 17 - Prob. 5RQCh. 17 - Prob. 6RQCh. 17 - Prob. 7RQCh. 17 - Prob. 1PCh. 17 - Prob. 2PCh. 17 - Prob. 3PCh. 17 - Prob. 4PCh. 17 - Prob. 5P
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- Consider an individual who was employed prior to having a child. Now, they face daycare costs (M) if they choose to go back to work. Assume that they earn an hourly wage (W) and their non-labour income (YN) is greater than their daycare costs (YN > M). Despite the daycare costs, this individual chooses to work T-Lo hours per week. Draw a graph that reflects this individual's income- leisure constraint (both with and without daycare costs), utility-maximizing indifference curve (Uo) and choice of leisure hours (Lo).arrow_forwardMary's employer is considering her for a firm-specific training program that will cost $4 per hour. Her current marginal revenue product is $20 per hour and will rise to $25 upon completion of the program. Of the following, Mary's training and posttraining wage, respectively, will most likely be O $20 and $25 O $16 and $25 O $20 and $ $21 O $16 and $21arrow_forward00 LO %24 WAGE 7. Shifts in labor supply Assume that the consulting and information technology industries employ people with similar skills. Suppose an increase in the demand for computer analysts leads to a rise in their wages, while the demand for consultants remains the same. The following graph shows the labor market for consultants in the United States. Show the effect of the rise in demand for computer analysts on the U.S. labor market for consultants by shifting the labor demand curve, the labor supply curve, or both. Supply Demand Supply Demand LABOR MacBook Pro * > %23 3. 4. R. A S K ב B.arrow_forward
- # of Workers 1 2 3 4 5 6 Output 3 8 16 21 23 24 MPP MPP: marginal physical product MRP: marginal revenue product MRParrow_forward2. Complete the following labor demand table for a firm that is hiring labor competitively and selling its product in a competitive market: Now assume that the firm is selling in an imperfectly competitive market and that, although it can sell 17 units for $2.20 per unit, it must lower product price by 5 cents in order to sell the marginal product of each successive labor unit (that is to sell 31 units of output it has to lower the price to $2.15, etc). Use the table above to calculate the firm's demand curve under this assumption. Make sure to put the appropriate price for each product level. Plot the two demand curves. Which curve is more elastic? If the market wage is $19.95, how many workers will each firm hire? Explain your answer.arrow_forwardQ27arrow_forward
- Question 14 Human capital is H-e0.07*5), where S is the number of years of schooling. What is the ratio of the productivities of the persons having 9 and 12 years of schooling, respectively. Hint: This will be the ratio of their wages in the competitive labor ratio of their wages in the competitive labor market. O 0.81 0.95 O 1.03 O 1.54arrow_forwardSuppose that in Workaholia the total population = 180 million, the number of unemployed = 5 million, and the labor force = S5 million. What is the employment to population ratio in Workaholia if 60 million people are ineligible to work? Select one: O a. 50.0% O b. 55.5% Oc 61.2% O d. 41.7% O e. 68.4%arrow_forwardGiving each firm that hires one or more welfare workers a payment of $1.000 per year, irrespective of the number it hires, is likely to be O A. successful because firms hire workers such that the marginal revenue product of labor equals the marginal cost of labor, and this approach reduces the marginal cost of labor by $1,000 per worker, increasing employment O B. successful at increasing employment by one additional worker because firms hire workers such that the marginal revenue product of labor equals the marginal cost of labor, and this approach reduces the marginal cost of labor by $1,000 for the first worker hired. O C. unsuccessful at increasing employment because firms hire workers such that the marginal revenue product of labor equals the marginal cost of labor, and this approach does not affect the marginal cost of labor. O D. successful because firms hire workers such that the marginal revenue product of labor equals the marginal cost of labor, and this approach reduces the…arrow_forward
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