I need help of these questions with detail explanation 3. We study the effects of changes in labor productivity on the labor market in the long run in the context of theMortensen-Pissarides model. For simplicity, unemployment benefits are set to b=0. In the long run, wagesand recruiting costs are proportional to labor productivity: w = ßy and k = cy where b and c are twowith y and the unemployment rateIncreases; Does not vary withwith y.positive real numbers. Equilibrium market tightnessDoes not vary; does not varyd.4.a.b.C.Increases; Decreasesa.b.C.Decreases; IncreasesLet u denote the unemployment rate, fthe job finding rate, and s the separation rate. The law of motion for theunemployment rate is (where Au=Ut+1 ut is the change in the unemployment rate):d.Au = fu + s(1 – u).e.Au = su + f(1 - u).Au = fus(1-u).Au = su - f(1 - u).Au = s(1 - u) - fu.e.-Does not vary; Increases

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3. We study the effects of changes in labor productivity on the labor market in the long run in the context of the Mortensen-Pissarides model. For simplicity, unemployment benefits are set to b=0. In the long run, wages and recruiting costs are proportional to labor productivity: w = By and kcy where b and c are two with y. positive real numbers. Equilibrium market tightness Does not vary; does not vary with y and the unemployment rate Increases; Does not vary with a. d. b. C. Increases; Decreases Decreases; Increases e. Does not vary; Increases

3. We study the effects of changes in labor productivity on the labor market in the long run in the context of the Mortensen-Pissarides model. For simplicity, unemployment benefits are set to b=0. In the long run, wages and recruiting costs are proportional to labor productivity: w = By and kcy where b and c are two with y. positive real numbers. Equilibrium market tightness Does not vary; does not vary with y and the unemployment rate Increases; Does not vary with a. d. b. C. Increases; Decreases Decreases; Increases e. Does not vary; Increases

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter16: Labor Markets

Section: Chapter Questions

Problem 16.12P

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