CONNECT F/MICROECONOMICS
21st Edition
ISBN: 2810022151240
Author: McConnell
Publisher: MCG
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Question
Chapter 25, Problem 8DQ
Sub Part (a):
To determine
Impact of illegal immigrants.
Sub Part (b):
To determine
Impact of illegal immigrants.
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A software company in Silicon Valley uses programmers (labor) and computers (capital) to produce apps for mobile devices. The firm estimates that when it comes to labor, MPL = 5 apps per month while PL = $1,000 per month. And when it comes to capital, MPC = 8 apps per month while PC = $1,000 per month. If the company wants to maximize its profits, it should: LO16.5 a. Increase labor while decreasing capital. b. Decrease labor while increasing capital. c. Keep the current amounts of capital and labor just as they are. d. None of the above.
Question 3
The figure below illustrates Maria's employment rent on her current job. Maria earns $12 an hour
and works 35 hours a week at a job that provides her with a disutility of work equal to $2 an hour. If
she were fired, Maria would receive an unemployment benefit of $6 an hour, and it would take her
44 weeks to find a job identical to the one she currently has.
Hourly wages ($)
O $9,240
O $4
Unemployment benefit = $6
Hourly wage = $12
O $6,160
Unemployment
benefit plus the
disutility of effort = $8
What is Maria's total employment rent?
O $18,480
0
= what Maria gets should she not lose her job today
= what Maria gets should she lose her job today
Maria's rent
when employed
Disutility of effort
when employed
What Maria receives
in unemployment
benefit during her
period of unemployment
Number of 35-hour weeks
Employment rent
per hour
Reservation wage
per hour
Expected duration of unemployment
= 44 weeks (1,540 hours)
In PPP terms, GDP per capita in Country A is 3 times higher than in
dollar terms. This means that if a US firm employs workers in Country
A at $5 per hour, this would give the the workers in Country A a
purchasing power equivalent to a wage of $15 per hour in the USA.
Select one:
O True
O False
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