MICROECONOMICS CONNECT ACCESS CODE ONL
21st Edition
ISBN: 9781260720853
Author: McConnell
Publisher: MCG
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Chapter 25, Problem 7RQ
To determine
Evaluate the statement whether it is true or false.
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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?
assume 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. Â
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 = $18
1. Given the demographic characteristics and future population growth in Canada, is there a role for government immigration policy to address the labor shortages in certain sectors of Canadian businesses? Explain clearly, logically and carefully.
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MICROECONOMICS CONNECT ACCESS CODE ONL
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- 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 .arrow_forwardWealth, earnings, and disposable income are just three of several ways of looking at inequality. Imagine a household that earns $80,000 per year from labor. In that year, it also receives an income of $3,000 from investments, pays $12,000 in tax, and receives $7,000 in transfers from the state. Which of the following is its market income and its disposable income? O $83,000; $71,000. O $83,000 $78,000. O $80,000; $68,000. O $80,000; $75,000. Jarrow_forwardAssume 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?arrow_forward
- As 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 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_forwardAssume that the labor demand equation for a fictional country is L d =30-w where w is the wage per hour worked and L d is the number of workers demanded by firms. Assume also that the labor supply equation for that country is L s =0.5(w) , where L s is the number of people willing to work . [LO 9.2,9.5] a. Find the equilibrium wage and quantity of labor employed b . At the equilibrium wage , how many people are unemployed ? c. How would the number of unemployed change if the supply of workers increased ?arrow_forward
- How would you expect immigration by primarily low-skill workers to affect American low-skilled workers?arrow_forwardUse the accompanying tables for Neon and Zeon to answer the questions that follow. Assume that the wage rate shown equals hourly output and income, and that the accumulated output and income are the sum of the marginal revenue products (MRPs) of each worker. a. Which country has the greater stock of capital and technological prowess? How can you tell? b. Suppose the equilibrium wage rate is $19 in Neon and $7 in Zeon. What is the domestic output (= domestic income) in the two countries? c. Assuming zero migration costs and initial wage rates of $19 in Neon and $7 in Zeon, how many workers will move to Neon? Why will not more than that number of workers move to Neon? d. After the move of workers, what will the equilibrium wage rate be in each country? What will the domestic output be after the migration? What is the amount of the combined gain in domestic output produced by the migration? Which country will gain output; which will lose output? How will the income of native-born workers…arrow_forwardExplain why the Ellis Island paradigm of U.S. immigration history excludes and cannot account for Africans (the forcibly emigrated and enslaved) and Native Americans, Mexican Americans, Asians and other non-European immigrants..arrow_forward
- Suppose that potential migrants make decisions only based on comparisons of their expected incomes. Now suppose the rural wage is $1 per day. Urban modern sector employment can be obtained with 0.25 probability and pays $3 per day. The urban traditional sector pays $0.40 per day.  (d) What simplifying assumptions are needed to make this a valid conclusion?  (e) Now, what would the urban traditional sector daily income have to be to induce no net rural-urban migration?  (f) If wages in all sectors are inflexible, what else adjusts in this model to lead to equilibrium (how much does it adjust and what is the intuition)?arrow_forwardSuppose that the current (first) generation consists of 1 million people, half of whom are women. Assume the total fertility rate is 1.2 and the only way people die is of old age.  Instructions: In part a, enter your answer as a whole number. In parts b and c, round your answers to 2 decimal places.  a. How big will the fourth generation (the great-grandchildren) be?     ___ people  b. How much smaller (in percentage terms) is each generation than the previous generation?     ___ percent  c. How much smaller (in percentage terms) is the fourth generation than the first generation?    ___ percentarrow_forwardat job group(Occupation) was the smallest among immigrants? Why do you think so few people from that group came to the United States?2.) What job group was the largest? Why do you think so many people from that group came to the United States?arrow_forward
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