EP ECONOMICS,AP EDITION-CONNECT ACCESS
20th Edition
ISBN: 9780021403455
Author: McConnell
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Chapter 21, Problem 13DQ
To determine
The auto insurance premiums.
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Brenda owns a construction company that employs bricklayers and other skilled tradesmen. Her firm’s MRP for bricklayers is $22.25 per hour for each of the first seven bricklayers, $18.50 for an eighth bricklayer, and $17.75 for a ninth bricklayer. Given that she is a price taker when hiring bricklayers, how many bricklayers will she hire if the market equilibrium wage for bricklayers is $18.00 per hour? a. Zero. b. Seven. c. Eight. d. Nine. e. More information is required to answer this question
45. Consider the following two statements:
(1) According to the Blinder-Oaxaca decomposition of the wage gap between two groups of
workers, differences in rewards for characteristics are considered to be evidence of
discrimination.
(2) Correspondence studies will never underestimate the extent of discrimination.
What can you say about these two statements?
O a. Both statements are incorrect.
O b. Statement (2) is correct, statement (1) is incorrect.
O c. Statement (1) is correct, statement (2) is incorrect.
O d. Both statements are correct.
Time left 0:30:14
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8. All of the following can be deemed as a tradeoff between equity and efficiency except
O a. unemployment compensation programs.
O b. students working individually on a project except collective group work.
Oc. disability programs.
Od. welfare programs.
Mary's employer is considering her for a firm-specific training program
that will cost $4 per hour. Her current marginal revenue product is
$20 per hour and will rise to $25 upon completion of the program. Of
the following, Mary's training and posttraining wage, respectively, will
most likely be
O $20 and $25
O $16 and $25
O $20 and $ $21
O $16 and $21
Chapter 21 Solutions
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- 10 9 8 7 O) 6 LO 5 4 3 2 1 2 3 4 5 6 7 8 9 10 • Label axis variables • Label curves Highlight the market envelope • Draw the wage-safety locus • Add indifference curves for a different worker. Are they more or less risk-averse?arrow_forwardSuppose that the wage rate is $13 per hour and the price of the product is $2. Values for output and labor are in units per hour. b. L 0. 24 44 60 72 80 4 84 Find the profit-maximizing quantity of labor. (Assume the firm can hire up to 6 workers.) The profit-maximizing quantity of labor is worker(s). (Enter a numeric response using an integer.) Suppose that the price of the product remains $2 but that the wage rate increases to $36. Find the new profit maximizing level of L The profit-maximizing quantity of labor is worker(s). Suppose that the price of the product decreases to $1 and the wage remains at $13 per hour. Find the new profit-maximizing L.arrow_forwardAssume that a worker has the Utility Function U(C,L)-C060 LO40 "C" refers to consumption in dollars and "L" to hours of leisure in a day. The worker has an offered wage of $10 per hour, 20 hours available for leisure or work per day, and $90 dollars a day from non-labour income. a) Find the budget constraint equation of the individual. b) Find the optimal choice for the individual in terms of units of leisure and income, the number of hours worked and the utility obtained. Make a well labeled graph that illustrates the solution to the problem of the worker. c) d) Find the supply equation of the individual. e) Calculate the reservation wage and briefly explain the definition. The wage when T=L or hours of work equal 0.arrow_forward
- Assume there are only two jobs and that both jobs use the skill set possessed by both Preferred (P) workers and Non-Preferred (NP) workers. Job 1 has only P workers; job 2 has Pand NP workers. Based on the Employee (Co-Worker) Taste Discrimination Model, if job 1 pays $18/hour and job 2 pays $24/hour, ceteris paribus: O job 2 will employ more NP workers than P workers. O aP worker with a dew 0.20 will choose job 1. O a P worker with a dew 0.20 will choose job 2. a P worker with a dew 0.20 will be indifferent between job 1 and job 2.arrow_forwardQuestion 14 Human capital is H-e0.07*5), where S is the number of years of schooling. What is the ratio of the productivities of the persons having 9 and 12 years of schooling, respectively. Hint: This will be the ratio of their wages in the competitive labor ratio of their wages in the competitive labor market. O 0.81 0.95 O 1.03 O 1.54arrow_forwardConsider an individual who was employed prior to having a child. Now, they face daycare costs (M) if they choose to go back to work. Assume that they earn an hourly wage (W) and their non-labour income (YN) is greater than their daycare costs (YN > M). Despite the daycare costs, this individual chooses to work T-Lo hours per week. Draw a graph that reflects this individual's income- leisure constraint (both with and without daycare costs), utility-maximizing indifference curve (Uo) and choice of leisure hours (Lo).arrow_forward
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