Table 9P - 2 uses data for the year 2016 , adjusted to be comparable to each other . All population values are in thousands . a . Fill in the bîanks in the table . [LO 9.1 ] b . In part a, you should have found that the unem ployment rates of the three countries differ significantly from one another . Suggest three possible reasons to explain why the countries might have different unemploym country working-age population labor force employed unemployed unemployment rate (%) labor-force participation rate (%) japan 110849 64460 2160 france 31164 3520 56.1 germany 76066 46096 5.7 ent rates .

Table 9P - 2 uses data for the year 2016 , adjusted to be comparable to each other . All population values are in thousands . a . Fill in the bîanks in the table . [LO 9.1 ] b . In part a, you should have found that the unem ployment rates of the three countries differ significantly from one another . Suggest three possible reasons to explain why the countries might have different unemploym country working-age population labor force employed unemployed unemployment rate (%) labor-force participation rate (%) japan 110849 64460 2160 france 31164 3520 56.1 germany 76066 46096 5.7 ent rates .

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter8: Productivity And Growth

Section: Chapter Questions

Problem 2.4P

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Joanne has just completed high school and is trying to determine whether to go to junior college for two years or go directly to work. Her objective is to maximize the savings she will have in the bank five years from now. If she goes directly to work, she will earn $22,000 per year for each of the next five years. If she goes to junior college, for each of the next two years she will earn nothing—indeed, she will have to borrow $6,000 each year to cover tuition and books. This loan must be repaid in full three years after graduation. If she graduates from junior college, in each of the subsequent three years, her wages will be $41,000 per year. Joanne’s total living expenses and taxes, excluding tuition and books, equal $15,000 per year. Instructions: Enter your responses as whole numbers. a. Suppose, for simplicity, that Joanne can borrow and lend at 0 percent interest. On purely economic grounds, should she go to junior college or work? After 5 years, the total value of…
Joanne has just completed high school and is trying to determine whether to go to communtiy college for two years or go directly to work. Her objective is to maximize the savings she will have in the bank five years from now. If she goes directly to work, she will earn $18,500 per year for each of the next five years. If she goes to community college, for each of the next two years she will earn nothing—indeed, she will have to borrow $6,000 each year to cover tuition and books. This loan must be repaid in full three years after graduation. If she graduates from community college, in each of the subsequent three years, her wages will be $35,000 per year. Joanne’s total living expenses and taxes, excluding tuition and books, equal $15,000 per year. Joanne should go to (Click to select) work junior college , since the total value of Joanne's savings would be $__ if she goes directly to work and $__ if she goes to community college.
Suppose that an additional year of schooling raised wages by 7 percent in 1970, regardless of the worker’s race or ethnicity. Suppose also that the wage differential between the average white and the average Hispanic was 36 percent. Finally, assume education is the only factor that affects productivity, and the average white worker had 12 years of schooling in 1970, while the average Hispanic worker had 9 years. By 1980, the average white worker had 13 years of education, while the average Hispanic worker had 11 years. A year of schooling still increased earnings by 7 percent, regardless of the worker’s ethnic background, and the wage differential between the average white worker and the average Hispanic worker fell to 24 percent. Was there a decrease in wage discrimination during the decade? Was there a decrease in the share of the wage differential between whites and Hispanics that can be attributed to discrimination?
Suppose that education does not affect worker’s productivity, but it is more costly for low-ability workers to obtain the education. If firms cannot distinguish between different workers they must pay them all the wage equal to the expected productivity. If they can distinguish between workers with different abilities, they pay each worker their marginal product of labour and make zero profits. 70% of workers in the population have low ability. The productivity of low-ability workers is YL = 20000, and the productivity of high-ability workers is YH = 50000. The cost of education to high-ability workers is CH(S) = S 4 , and the cost of education to low-ability workers is CL = S. 1. Suppose firms cannot observe worker’s education. What wage will they offer to a highability worker? What is the optimal level of schooling for the high-ability worker? Why? 2. Suppose that firms can observe worker’s educational attainment and believe that workers with the level of schooling above some…
Suppose that education does not affect worker’s productivity, but it is more costly for low-ability workers to obtain the education. If firms cannot distinguish between different workers they must pay them all the wage equal to the expected productivity. If they can distinguish between workers with different abilities, they pay each worker their marginal product of labour and make zero profits. 70% of workers in the population have low ability. The productivity of low-ability workers is YL = 20000, and the productivity of high-ability workers is YH = 50000. The cost of education to high-ability workers is CH(S) = S 4 , and the cost of education to low-ability workers is CL = S. (Answer 4.5.6 only) 1. Suppose firms cannot observe worker’s education. What wage will they offer to a highability worker? What is the optimal level of schooling for the high-ability worker? Why? 2. Suppose that firms can observe worker’s educational attainment and believe that workers with the level of…
Urgently need. What does the two gap model of poverty trap say? Poverty arises when the rate of return on capital exceeds the growth rate of income. Poverty arises from the gap between savings and investment and can be remedied by foreign aid. Poverty arises when capital market imperfections restrict the amount individuals can borrow. Poverty arises when a country invests in the traditional sector with constant returns to scale, and not in the modern sector with increasing returns.
Answer the given question with a proper explanation and step-by-step solution. Suppose the US adopts a form of universal basic income program in which each household is guaranteed to have at least $3,000 in monthly income. For example, if a household’s average monthly income falls below $3,000 in a given quarter, then the difference is made up with federal direct payments. How would this program affect workers’ decisions to participate in the labor force? How would this program impact income equality in the US?
Suppose a worker’s skill is captured by his efficiency units of labor. The distribution of efficiency units in the population is such that worker 1 has one efficiency unit, worker 2 has two efficiency units, and so on. There are 100 workers in the population. In deciding whether to migrate to the United States, these workers compare their weekly earnings at home ( w0) with their potential earnings in the United States (w1).The wage-skills relationship in each of the two countries is given byw0 = 700 + 0.5sandw1 = 670 + swhere s is the number of efficiency units the worker possesses.a. Assume there are no migration costs. What is the average number of efficiency units among immigrants? Is the immigrant flow positively or negatively selected?b. Suppose it costs $10 to migrate to the United States. What is the average number of efficiency units among immigrants? Is the immigrant flow positively or negatively selected?
Workers in countries such as Sweden and Germany work fewer hours per week, on average, than do workers in the United States. Does this mean that Swedes and Germans are lazier than Americans? Explain how laziness could be interpreted in the context of the work-leisure choice model developed in this chapter. What other information might you want to gather to determine whether Swedes or Germans were indeed less work oriented that Americans?
Assume that the productivity of farm labour depends on daily caloric intake, similarly to that depicted in Figure17.4. Using this kind of diagram, compare the efficiency wages that would apply to the following two types of workers: • A landless labourer • A labourer with small plot of land on which he grows staple crops Describe the likely equilibrium unemployment rates and wage rates for landless labourers and small landholders. Judging partially on the basis of this example, what sorts of data and what empirical strategies might you use to see whether nutritional efficiency wages were an important element in the rural labour markets of poor, rural economies?
Suppose that the returns to education are 13.4% per year for the first four years of schooling (grades 1–4), 10.1% per year for the next four years (grades 5–8), and 6.8% per year for education beyond eight years. In a certain country, everyone in the labor force in the year 2000 had 12 years of education. In 1950 everyone in the labor force had 4 years of education. What was the average annual growth in income per worker that was due to the increase in education?
What consumption differences might you expect to observe between families characterized as underprivileged versus those whose income is average for its social class? Do you have a tendency to overestimate the class you are in? If so, why? If not, why?

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country	working-age population	labor force	employed	unemployed	unemployment rate (%)	labor-force participation rate (%)
japan	110849		64460	2160
france		31164		3520		56.1
germany	76066	46096			5.7