A worker has no non-labor income and is earning $14/hour.  He maximizes utility by working 40 hours per week.  Begin by drawing a graph that illustrates this to be the utility-maximizing solution.   The same worker loses his job.  He is entitled to unemployment compensation that will pay up to 50% of his weekly earnings.  The worker has an opportunity to supplement his unemployment compensation by taking a job that pays $7/hour.   Using the same graph, show the worker's new budget line and his utility-maximizing decision as whether to work the new job and how many hours to work.   Make sure your graph shows the relevant budget lines and indifference curves.

Using indifference curve analysis, show the effects of an increase in the hourly wage rate on labor supply (hours of work) and earnings. Identify the income and substitution effects.

According to the Economics Policy Institute (Mishel and Wolfe, 2019) CEO pay has grown 940% since 1978 while the compensation of the average worker has only risen 12%. While you can easily find sources that provide statistics that conflict with these numbers, you would be hard pressed to find any credible source that refutes the idea that the rate of pay of CEO’s and other upper-level managers has not dramatically increased relative to an organization’s lower-level employees in just about any 10 or more year period over the past 60 years. In the world of Adam Smith, the “invisible hand” of the free market capitalistic model would address inequities/out of balances. Are the forces represented by the “invisible hand” working? Why or why not? Is there an ethical dimension to the discussion of upper-level manager compensation? Why or why not? How does (or does it?) levels of pay of upper management impact the rest of us commoners?

Mark can work up to 80 hours each week at a pre-tax hourly wage of $20 but faces a constant 20 percent tax on his earnings. Thus, Mark maximizes his utility by choosing to work 50 hours per week. The government proposes a negative income tax whereby everyone is given $300 per week and anyone can supplement their income further by working. To pay for the negative income tax, tax on earnings will be increased to 50 percent. On a single graph, draw Mark's original budget line and his budget line under the negative income tax. Show that Mark will work fewer hours if the negative income tax is implemented Will Mark's utility be greater under the negative income tax? Discuss your answer.

Consider a representative consumer with preferences over consumption e and leisure I given by u(e,l) = 1/4 * ln(c) + 3/4 * ln(l) Assume that the price of consumption is normalized to p = 1 and the consumer has h = 24 hours of total time available to divide between work and leisure. The consumer's wage per hour of work is w = 24 The consumer also receives dividend (profit) income of pi = 39 and pays lump-sum taxes of T = 7 (a) Write out the consumer's budget equation, and draw a graph of the budget constraint. (b) Solve for the optimal decisions e and 1. How many hours per day is the consumer working? (c) Suppose the consumer's wage decreases to w = 16 Solve for the new optimal choices of c and I". Relative to the solution in part (b), do consumption, leisure, and hours worked increase, decrease, or stay the same? Give an intuitive explanation for why these changes occur. (d) When the wage changes in part e, determine whether the consumer experiences an income effect, a substitution…

Consider a worker who consumes one good and has a preference for leisure. She maximizes the utility function u(x, L) = xL, where a represents consumption of the good and L represents leisure. Suppose that this worker can choose any L = [0, 1], and receives income w(1 L); w represents the wage rate. Let p denote the price of the consumption good. In addition to her wage income, the worker also has a fixed income of y ≥ 0. (a) Write down the utility maximization problem for this consumer. (b) Find the Marshallian demands for the consumption good and leisure. (c) Find the indirect utility as a function of p, w, and y.

Problem #3: Labor Unions (20 points) Sarah is thinking if she should join the labor union in their company. Her utility function is U (c, 1) = (cl)05, where c denotes consumption, and I denotes leisure. She has 16 hours each day to allocate between work and leisure. 1. Given her non-labor income is zero, how many hours will Sarah work at $7 wage/hour? In addition, how much consumption and leisure can she afford, and how much utility can she achieve from this? 2. If the labor unioh bargains for a $10.5 overtime pay rate for work hours beyond 8 hours, will Sarah benefit from this proposal? 3. If, instead, the labor union proposes an 8-hour workday, will Sarah benefit from it?

Lance lives in Williston, North Dakota. The firms in town, such as the Walmart, pay teenagers without a high school degree the federal minimum wage of $7.25 an hour. Because his parents provide him Y (mostly in the form of room and board), Lance chooses to stay in school and not work. However, a new fracking firm starts production nearby so the wage rises to three times the minimum wage. Use a labor-leisure choice figure to show why he does not work initially but then works a substantial number of hours at the higher wage. Draw Lance's original budget constraint and show that he does not choose to work. The firms in town, such as the Walmart, pay teenagers without a high school degree the federal minimum wage of $7.25 an hour. Assuming the price of consumption is $1.00, what is the slope of Lance's original budget constraint? The slope of Lance's original budget constraint is places.) (Round your response to two decimal C

Can you help me with part b please?