MICROECONOMICS (LL)W/ACCESS >IC<
20th Edition
ISBN: 9781308103341
Author: McConnell
Publisher: MCG/CREATE
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Chapter 21, Problem 13DQ
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Complete the following labor supply table for a firm hiring labor competitively: LO17.2
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- PROBLEMS 1. Workers are compensated by firms with “benefits” in addition to wages and salaries. The most prominent benefit offered by many firms is health insurance. Suppose that in 2000, workers at one steel plant were paid $20 per hour and in addition received health benefits at the rate of $4 per hour. Also suppose that by 2010 workers at that plant were paid $21 per hour but received $9 in health insurance benefits. LO17.1 By what percentage did total compensation (wages plus benefits) change at this plant from 2000 to 2010? What was the approximate average annual percentage change in total compensation? By what percentage did wages change at this plant from 2000 to 2010? What was the approximate average annual percentage change in wages? If workers value a dollar of health benefits as much as they value a dollar of wages, by what total percentage will they feel that their incomes have risen over this time period? What if they only consider wages when calculating their incomes?…arrow_forwardMa2. Required: Question 3.(LO3 Apply) Simon Ltd is run by Simon Leather who makes leather belts for designers. He uses the finest Argentinean leather and needs highly trained machinists to make the belts up to the quality designers expect. His beits usually sell for £50 per item and use 0.2m² of leather and 30 minutes of labor. Simon Ltd has 5 staff. They work a standard 8-hour day, 5 days a week, 48 weeks of the year. They earn £15 per hour. Leather costs £20 per meter. Simon also has some variable overheads of £6 per unit. Fixed overheads are £28,800. a) Calculate the number of belts Simon will have to sell to break even. Simon decides to branch out and start to also sell handbags to the same market. The handbags sell for €250 each and use 1.5m² of leather with 1 hour of labor being required. Variable overheads are £20 per handbag. There has been a bad case of foot and mouth in Argentina. Simon can only use the leather he has currently being shipped to him for the next…arrow_forward14.ASsume the labor force is made up of 40% women and 60% men. If 40% of all manufacturing jobsare held by women and 90% of the highest-paying management and executive level jobs inManufatacturing are held by men, then, with respect to the manufacturing sector, it can be said that: multiple choiceO.a. there is no horizontal occupational segregation but there is vertical occupational segregation. O.b. there is both horizontal and vertical occupational segregation.O.c. there is no sex-based discrimination in entry-level By solving it for 'r' through hit and trial method, the required interest rate can be found.positions but there is sex-based discriminationin management level positions.O.d. there is no sex-based discrimination in management positions but there is sex-baseddiscrimination in executive level positions.arrow_forward
- If TP or Q for the fifth worker is 83, and TP or Q for the sixth worker is 97, MP for the sixth worker is O 14. O.071. O-14. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.arrow_forwardSuppose a two-person household. Person 1 has h1 units of time available and takes l1 units of leisure time, and person 2 has h2 units of time available and takes l2 units of leisure time. Collectively, the two persons in the household care about their total consumption c, and their total leisure l=l1+l2, and they have preferences over their total consumption and total leisure just as specified in the course. But person 1 faces a market wage w1, and person 2 faces a market wage w2, with w1 > w2. 1) Draw the budget constraint faced by the two-person household. What will the household do, that is, how much does each household member work? 2) What happens if w2 rises? (w1 > w2 still holds) 3) Explain your results and interpretarrow_forwardassume there are two types of workers, low- and high-ability, and let 0 = 0.25 be the proportion of high-ability workers in the population. Assume their marginal productivity and, therefore, their wages are wh = $20 and wl = $16, and that both types can use college education to signal high ability. The cost of college education for low-ability workers is cl = $5 whereas the cost for high-ability workers is ch = $2. How much do firms pay to each worker type when they cannot differentiate them? (a) wh = $20 and wl = $16 (b) wh = $2 and wl = $5 (c) w = $17 (d) w = $18arrow_forward
- a. Suppose a restaurant hires only women to wait on tables, and only men to cook the food and clean the dishes. Is this most likely to be indicative of employer, employee, consumer, or statistical discrimination? b. The dropout rate of minority and international students at U.S. colleges and universities is higher than it is for white American students. Suppose you strongly believe this is due to discrimination. Is the empirical pattern most likely indicative of employer (college administrations), employee (college faculty and staff), consumer (students), or statistical discrimination?arrow_forwardAs one of the largest and fastest-growing industries in 2018, health care provided how many jobs for wage and salary workers? O 18 million 30 million 3 pts O 24 million O 12 millionarrow_forwardSuppose the demand curve for union labor is given by the equation: L = 450 − 3W.Suppose the current wage is $20. Now suppose the union is successful in raising the wage of its members to $28. At the same time, it is able to shift the demand for labor out to: L = 510 − 3W. Has the higher wage negotiated by the union reduced the employment opportunities of its members? If so, by how much? c. Who has benefitted and who has lost as a result of this negotiation. Be specific and complete.arrow_forward
- Suppose in a particular labor market, the demand for labor is given by the equation LD = 180 – 3W and that the labor supply in this market for native-born citizens is given by LN = 3W, while the supply curve of immigrants in this market is given by LI = 2W, where L represents the number of workers, W is the wage expressed in real terms. Finally, suppose the production function can be represented by ?=100√L a. Assuming immigration is entirely prohibited, what are the equilibrium wage and employment level in this market? b. What would be the equilibrium wage and employment level in this market if immigration were completed legalized? c. How many jobs do natives lose as a result of this immigration? How much aggregate income is lost? d. Assuming the costs of capital in this market are zero, find the total profits to firms before and after immigration. What is the change in total profits? e. Compute the total output of this market before and after immigration. How much total output does…arrow_forwardThis question is in the context of the Becker model. Suppose Firm A and Firm B sell their output in the same output market, purchase inputs in the same input markets and use the same production technology. Suppose the owners of Firm A and Firm B hire only women, with the following inequality true:WF(1 + dA) < WMandWF(1 + dB) < WM.If the discrimination coefficient is higher for Firm A than Firm B (dA > dB), then which of the following statements is true?●Firm B will earn higher profits●Both firms will earn the same profits●Firm A will earn higher profits●Both firms will earn less profit than they would if they had d=0arrow_forwardSuppose 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?arrow_forward
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