Recall the model of firm's technology choice illustrated below, which provides an explanation for why the Industrial Revolution occurred in eighteenth-century Britain. 1700s (isocost FG) .Steep isocost: relative price of labour to coal is high. • A-technology now lower cost than the B-technology. • We know this because B lies outside the line FG. 1600s (isocost HJ) Firms use technology B. At this relative price, no incentive to develop technology A. ..We know this because A costs more (it lies outside the line HJ). 1 H 9 10 11 12 13 1 2 3 4 5 6 7 8 Number of workers In addition, recall the figure below which shows the historical trends of wages relative to the cost of capital in England and France from the late sixteenth to the early nineteenth century. 1.8 1.4 England France 0 1580 1600 1620 1640 1660 1680 1700 1720 1740 1760 1780 1800 1820 Year Tonnes of coal 10 2 Wages relative to the cost of capital 9 0.9 0.5

Recall the model of firm's technology choice illustrated below, which provides an explanation for why the Industrial Revolution occurred in eighteenth-century Britain. 1700s (isocost FG) .Steep isocost: relative price of labour to coal is high. • A-technology now lower cost than the B-technology. • We know this because B lies outside the line FG. 1600s (isocost HJ) Firms use technology B. At this relative price, no incentive to develop technology A. ..We know this because A costs more (it lies outside the line HJ). 1 H 9 10 11 12 13 1 2 3 4 5 6 7 8 Number of workers In addition, recall the figure below which shows the historical trends of wages relative to the cost of capital in England and France from the late sixteenth to the early nineteenth century. 1.8 1.4 England France 0 1580 1600 1620 1640 1660 1680 1700 1720 1740 1760 1780 1800 1820 Year Tonnes of coal 10 2 Wages relative to the cost of capital 9 0.9 0.5

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter30: The Labor Market

Section: Chapter Questions

Problem 4E

See similar textbooks

Similar questions

For a subsistence agricultural household, which of the following happen when the price of the staple they are producing increases? [SelectMultiple] Group of answer choices Due to profit effect, their utility as producers increases. The impact on overall welfare of the household is ambiguous since it depends on the relative forces of profit effect and price effect. Their is no effect since subsistence households never sell or buy their staple production. Due to price effect, their utility as consumers decreases.
Consider this graph represents McDonald's demand for labor. Choose the 2 scenarios that would shift the demand for labor from D1 to D3. Group of answer choices McDonalds buys a machine that can do the work of 5 human employees. (Long Run) Breaking News: All McDonald's food contains traces of rat poison. People decide to eat less. The Travis Scott meal is heavily promoted on social media increasing people's desire to eat at McDonalds more often. McDonalds buys a machine that can do the work of 5 human employees. (Short Run)
For the following alternatives, argue whether it is true, false or uncertain, according to the following statement:"If the marginal productivity value (MVP) of the last worker hired is $10 and the wage is $12, then the firm":(a) Will have an economic utility.b) Needs to decrease the wagec) It needs to expand productiond) It needs to decrease the number of workers hired.
what are two key problems that arise for the modern marginalist theory of the firm when the firm has a constant-returns-to-scale (CRS) technology?
In 2013, France's labor unions won a case against Sephora to prevent the retailer from staying open late and forcing its workers to work “antisocial hours.” The cosmetic store does about 20 percent of its business after 9 p.m., and the 50 sales staff who work the late shift are paid an hourly rate that is 25 percent higher than the rate paid to workers on the day shift. Many of the late-hour workers are students or part-time workers, who are put out of work by these new laws. Forcing the retailer to close earlier forces the store's assets, such as the building and merchandise, to be moved from lower or higher valued activities to higher or lower valued activities. True or False: In order to profit from this law, an individual could purchase Sephora products during the day and sell them at a higher price during normal store hours.
Q54 Justin Trudeau, who owns a barbershop in Ottawa, charges and charges $20 per haircut. By hiring one barber named Sophie at $15 per hour, the shop can provide 20 haircuts per eight-hour day. By hiring a second barber, Shelly, at the same wage rate, the shop can now provide a total of 36 haircuts per day. Justin Trudeau should Multiple Choice hire the second barber, Shelly, because she will add $320 to profits. not hire the second barber, Shelly, because she will diminish profits. not hire the second barber, Shelly because she is less productive than the first barber, Sophie. hire the second barber, Shelly, because she will add $200 to profits. close shop.
Suppose that low-productivity workers all have marginal products of 8 and high-productivity workers all have marginal products of 16. The community has equal numbers of each type of worker. A firm cannot directly tell the difference between the two types of workers. Without any further information, the firm is willing to offer a wage at the average productivity. The local community college offers a course in microeconomics, which does not increase productivity for either type of workers. High-productivity workers think taking this course is as bad as a wage cut of $3, and low-productivity workers think it is as bad as a wage cut of $9. With the certificate, the firm is willing to offer a high wage of $16. Without it, the firm is willing to offer a low wage of $8. But the firm cannot still tell the true productivity. In this case, is it worth for the low-productivity workers taking the course? (Yes, No, or Uncertain) Thus, this situation will lead to a (pooling, or separating)…
Discuss the links between managerial economics and industrial economics.
True or false The single most important element in managerial economics is the microeconomic theory of the firm.
Suppose that a professor of labor economics finds that one of their research subjects has earned significantly higher wages throughout their lifetime than would be predicted by standard measured variables. The economist also notes that each of the subject's job roles was linked to social connections established at their family's yacht club. Which item from the following list most likely explains this individual’s high earnings? Chance Efficiency wages Compensating differentials Effort Suppose that Juanita receives higher pay from her company than her colleagues, despite the fact that they perform basically the same type of role. If Juanita's productivity is about 37 percent higher than that of her second-best colleague, which of the concepts from the following list can explain this wage disparity? Check all that apply. Human capital Chance Compensating differentials Efficiency wages Effort
G.R. Dry Foods Distributors specializes in the wholesale distribution of dry goods, such as rice and dry beans. The firm’s manager is concerned about an article he read in this morning’s The Wall Street Journal indicating that the incomes of individuals in the lowest income bracket are expected to increase by 10 percent over the next year. While the manager is pleased to see this group of individuals doing well, he is concerned about the impact this will have on G.R. Dry Foods.What do you think is likely to happen to the price of the products G.R. Dry Foods sells? Why? The price will increase, because dry beans and rice are normal goods. The price will increase, because dry beans and rice are inferior goods. The price will decrease, because dry beans and rice are inferior goods. The price will decrease, because dry beans and rice are normal goods.
Answer the given question with a proper explanation and step-by-step solution. Consider the Labor Economics Question. This will provide insight into the idea of the optimal number of workers and the value of the marginal product of labor. If wages in the restaurant is $16.80 per hour and the price of a Hamburger is $4.20 and the production function for the workers is: Q = 6L – 0.25L2^2 a. How many workers should Your Restaurant employ during the lunch hour to maximize profits? (note—the value of the marginal product of labor and the marginal revenue product are the same) We maximize profits which are total revenues less total costs: b. Compute the maximum profit at Your Restaurant. (note—consider that profit involves Total Revenue and Total Costs). c. Compute the profit created if You hire an additional worker. Explain why it is or is not profit maximizing to hire an additional worker. d. Suppose instead that You wants to keep the lines as short as possible by maximizing production.…