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ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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
Transcribed Image Text:Assume there are only two jobs and that both jobs use the skill set possessed by both Preferred
(P) workers and Non-Preferred (NP) workers. Job 1 has only P workers; job 2 has Pand NP
workers.
Based on the Employee (Co-Worker) Taste Discrimination Model, if job 1 pays $18/hour and job
2 pays $24/hour, ceteris paribus:
O job 2 will employ more NP workers than P workers.
O aP worker with a dew 0.20 will choose job 1.
O a P worker with a dew 0.20 will choose job 2.
a P worker with a dew 0.20 will be indifferent between job 1 and job 2.
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