Which of the following models, if any, rests on the assumption of competitive factor markets? Gravity model Ricardian model Heckscher-Ohlin model
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Which of the following models, if any, rests on the assumption of competitive factor markets?
Gravity model
Ricardian model
Heckscher-Ohlin model
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- The dual labor market hypothesis was proposed by the influential economist Gary Becker.Do the migration trends, unemployment trends and rural-urban income ratio trends behave in the way you would expect based on the Harris-Todaro model? Explain.The following are correct statements about the Labor Market model, EXCEPT: Question 14 options: The Demand for labor is mainly determined by the Marginal Productivity of Workers. The Supply of Labor is mainly determined by the Opportunity Cost for Work. An increase in Labor Productivity will likely lead to higher wages but less total labor demand. In equilibrium, the market for labor will attain zero unemployment.
- Consider the following model of a competitive labour market where both firms and workers have perfect foresight and symmetric information about the price level (that is, no misperceptions). Firms' technology is given by the production function y = a N ½ (production function) where a is a positive constant representing total productivity, N is employment and the elasticity of production to employed labour is 1/2. The government requires firms to pay pension contributions to the fiscal authority: the contribution is a small fraction x of the wage paid to each employed worker. Therefore, firms profits equal P y - W N - x W N and they are maximized taking the price level P, the nominal wage W, and the pension contribution rate x as given. Labour supply is given by: W = P b N where b is a positive constant. Answer all the following questions. a) Derive the labour demand schedule by solving the profit maximization problem of firms.What reasons do Arnold and Bowie give for doubting Maitland’s claim that improving employee wages will inevitably lead to more unemployment and poverty?For a competitive equilibrium in a two-period model, must there be an equal amount of borrowing and lending?
- The Ricardian model predicts that the market prices for goods with trade cannot be outside the range of the market prices in autarky. True FalseQ) In the two-sided search model, the choice that responds to economic conditions is:- a) a firm's choice of how many vacancies to post. b) the government's choice of the employment insurance benefit. c) an unemployed worker's choice of search effort. d) an unemployed worker's choice of the reservation wage.Classify the following as microeconomics or macroeconomics and provide a justification for your response. A comparison of alternative tax policies and their respective impacts on the rate of the nation’s economic growth The decision by McDonald’s to hire fewer workers because of an increase in the minimum wage. Susan’s decision about how much income to save The central bank announces that it is increasing the discount rate in an effort to slow the rate of inflation. Question 2 A snowboard company currently hires 10 skilled employees who are paid a weekly wage of $1,000.00. the cost of capital is $3000 and it is fixed, which means that it does not vary with output. The company is currently producing 240 snowboards. The company’s cost will be $13,500 if it produces an additional snowboard. A customer is willing to pay $550 for the 241st snowboard. Should the company produce and sell it? Timothy quits his job which pays $84000 a year, to enrol in a 2-year…
- Why do efficiency wages generate involuntary unemployment? What factors prevent the market from clearing in efficiency wage models?The Economist article, Left in the Lurch, notes that throughout history many places that have experienced economic hardships have seen their residents leave. But, it notes that such "mobility" by workers from such places is _______ in the U.S. today. Part of this dynamic reflects policies that ______ population growth in more thriving communities (and thus make it more difficult for workers to relocate). Another part of this dynamic reflects public policies that often ______ the incentive to move. Choose the correct combination from the choices below. a. decreasing; enhance; increase b. increasing; restrict; reduce c. decreasing; restrict; reduce d. increasing; enhance; reduceThe (2 factor,2good,2countries) Heckscher-Ohlin model is based on neoclassical production functions ."Describe the main assumption and characteristics of these production functions.
