Question 4A and B are both currently single. They are deciding whether or not they should get married and among other thingsare considering the effect that marriage will have on the quantity of home commodities that they can produce.While single, A and B each face the following budget and time constraints:BC: x = whTC: 1+h = 1where h is market hours, w is the market wage and there is a time endowment of 1 unit.If A and B marry, they will face the following budget and time constraints:BCM: x = x4 + xB = waha + wghgTC: tA + hA = 1TC: ta + ha = 1t = tA+Bwhere the superscript M stands for `married".Now consider, A has a higher market wage than B does: wA = 4w'B . B specializes in home production.In the above scenario, the expression for the production function z in terms of wB and t is4w B (2 – 1)!8wB (2 – 1)1O 4wB (2 + 1)O 4wa (2 - 1)Oooo

Answered: A and B are both currently single. They…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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