5. As a hypothetical case, suppose the typical individual has a utility function expressed as U = (C – 50)*(L – 10), where C is consumption and L is leisure time. The current wage, w, is $5 and she has a weekly return on assets of V = $100. She only has 60 hours per week to divide between work hours, h, and Leisure. A number of countries and communities are considering implementing a “Guaranteed Basic Income" as policy. A "Guaranteed Basic Income" is a government payment of a fixed a amount of money for each person Suppose the country of interest sets the weekly payment at $100. i) Using the Neo-classical labor supply with reference to specific numerical values discuss the consequences of the above "Guaranteed Basic Income". ii) Using the basic Supply and Demand for labor approach discuss the consequences of the "Guaranteed Basic Income" policy on the overall labor market. iii) Using a feedback approach, from the Neo-classical labor supply to market equilibrium and back to labor supply, discuss the net results of the Guaranteed Basic Income policy given.

5. As a hypothetical case, suppose the typical individual has a utility function expressed as U = (C – 50)*(L – 10), where C is consumption and L is leisure time. The current wage, w, is $5 and she has a weekly return on assets of V = $100. She only has 60 hours per week to divide between work hours, h, and Leisure. A number of countries and communities are considering implementing a “Guaranteed Basic Income" as policy. A "Guaranteed Basic Income" is a government payment of a fixed a amount of money for each person Suppose the country of interest sets the weekly payment at $100. i) Using the Neo-classical labor supply with reference to specific numerical values discuss the consequences of the above "Guaranteed Basic Income". ii) Using the basic Supply and Demand for labor approach discuss the consequences of the "Guaranteed Basic Income" policy on the overall labor market. iii) Using a feedback approach, from the Neo-classical labor supply to market equilibrium and back to labor supply, discuss the net results of the Guaranteed Basic Income policy given.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter17: Capital And Time

Section: Chapter Questions

Problem 17.2P

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As a hypothetical case, suppose the typical individual has a utility function expressed as U = (C – 50)*(L – 10), where C is consumption and L is leisure time. The current wage, w,is $5 and she has a weekly return on assets of V0020= $100. She only has 60 hours per week to divide between work hours, h, and Leisure. A number of countries and communities are considering implementing a “Guaranteed Basic Income” as policy. A “Guaranteed Basic Income” is a government payment of a fixed a amount of money for each personSuppose the country of interest sets the weekly payment at $100. Using the Neo-classical labor supply with reference to specific numerical values discuss the consequences of the above “Guaranteed Basic Income”. Using the basic Supply and Demand for labor approach discuss the consequences of the “Guaranteed Basic Income” policy on the overall labor market. 3.Using a feedback approach, from the Neo-classical labor supply to market equilibrium and back to labor supply,…
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