Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN: 9781305506725
Author: James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher: Cengage Learning
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Chapter 26, Problem 9CQ
To determine
Differences in the wage earnings and the abilities of workers.
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Economics: Private and Public Choice (MindTap Course List)
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- Suppose that a person's life is divided into two periods. A period of poor economic times, when this person earns $28 per hour of work, and a period of good economic times when they earn $42 per hour. The person cannot work more than 2000 hours in a single period, but they want to earn $107,000 total across both periods. What is the minimum number of hours this person needs to work total? Round your answer to two decimal places. Then take a second and thing about what is happening to GDP in each time period and connect the dots to Real Business Cycle Theory.arrow_forwardYou are given a scenario where this a change in a factor of production or a change in demand for an item. You need to explain in sentence form how this would change demand for labor. You develop a popular video game and continue to develop new versions to keep people interested in the game.arrow_forwardWhat is the opportunity cost associated with doing your homework and earning your degree? What have you sacrificed and what long-term gain is expected? How do these factors play into labor supply and demand, or what terminology is used in our readings to explain this phenomenon?arrow_forward
- Suppose Kara maximizes her profits by hiring workers to produce hand-made soaps. Her soaps sell for $1 each. How should Kara decide on how many workers she should hire? a.Hire workers up to the point when the price of her soaps starts to fall from $1 b.Hire workers up to the point when the total product of all her workers is at its maximum c.Hire up to the point when the wage rate equals to the value of the marginal product of the last worker hired d.Hire up to the point when the marginal product of the last worker hired is equal to zeroarrow_forwardUse your knowledge of household production theory to indicate the following: a) The expected effect of a wage increase on women’s labour supply. b) The expected effect of an increase in the wage of a women on the demand for children. c) Why the substitution effect for labour supply may be larger for women than men. d) The effect of a spouse’s disability on the other person’s labour supply, where the spouse requires home (not institutional) care. e) The effect on the same spouse’s labour supply, as in (d), if the government (or private insurance) provided financial compensation to the family.arrow_forwardShort answer question. Discuss how a firm’s demand for labor and the wage rate might change if the market were to become imperfect.arrow_forward
- Use the following graph, which depicts Mighty Max’s labor demand for his duffel bag business, to answer the following questions. The labor demand curve shown is calculated based on a duffel bag price of $10. Assume that the price per duffel bag rises from $10 to $20. What is the value of the marginal product of labor of the twentieth worker? A. $50 B. $70 C. $60 D. $30 E. $40arrow_forwardWhat is labor economics? Which types of questions do labor economists analyze?arrow_forwardSuppose the following graph shows the earnings trajectory of college-educated workers (orange line) and of workers with only a high school diploma (blue line), through age 34. Use the grey quadrilateral (star symbols) to shade the area representing the direct costs of attending college for four years. Then use the purple quadrilateral (diamond symbols) to shade the area representing the opportunity cost of attending college for four years rather than entering the work force immediately after completing high school. Finally, use the green quadrilateral (triangle symbols) to shade the area representing the difference in earnings between college graduates and high school graduates between the ages of 22 and 34. Hint: Be sure that the coordinates of the end points of the quadrilaterals are exactly the same as the coordinates of the areas they are to cover. Once the quadrilateral is in place, dick on it to show the value of the shaded area. ? 100 8 8 8 8 EARNINGS AND COST (Thousands of…arrow_forward
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