Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN: 9781305506725
Author: James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 26, Problem 3CQ
(a):
To determine
Differences in the wage of a lawyer and a minister.
(b):
To determine
Differences in the wage of an accountant and an elementary teacher.
(c):
To determine
Differences in the wage of a business executive and a social worker.
(d):
To determine
Differences in the wage of a country lawyer and a Wall Street lawyer.
(e):
To determine
Differences in the wage of a skilled, experienced craftsperson and a school dropout.
(f):
To determine
Differences in the wage of an upper-story window washer and ground-floor window washer.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Boeing created, and recently expanded, an airplane manufacturing center in Charleston, South Carolina. One of the factors that likely influenced this location decision is that South Carolina is a "right to work" state. This represents
a) a place factor related to labor.
b) a transportation factor related to the market.
c) higher wages for Boeing workers in South Carolina relative to Washington.
d) a place factor related to the political environment.
Q2) Samantha has an annual non-labour income of $5000. Suppose she has the total
available time of 4160 hours per year. Samantha's wage rate is $15 per hour, and she
chooses to work 2000 hours in a year. Suppose when Samantha's wage rate increases
from $15 to $18 per hour, she will work 2040 hours. At $18 per hour, if she works 2200
hours per year, she would be indifferent to her original work decision before the wage
increase.
a) Draw a diagram to show all the given information related to Samantha's work
circumstances. Calculate all the relevant income levels and label them in the graph.
b) Calculate Samantha's income effect, substitution effect and total effect related to the
wage increase. Show them in the diagram.
A perfect competitor charges a price of $30. The first worker he would hire would have a marginal physical product of 20, the second worker he would hire would have a marginal physical product of 18, the third worker would have a marginal physical product of 16, and the fourth worker would have a marginal physical product of 14.
(a) How many workers would he hire if the wage rate were $540? worker(s) hired How much would his wage bill be? $ wage bill
(b) How many workers would he hire if the wage rate were $470? worker(s) hired How much would his wage bill come to? $ wage bill.
Chapter 26 Solutions
Economics: Private and Public Choice (MindTap Course List)
Knowledge Booster
Similar questions
- Ken has an annual non-labour income of $5000. Suppose he has the total available time of 52×80=4160 hours per year. Ken's wage rate is $15 per hour, and he chooses to work 2000 hours in a year. Suppose Ken’s wage rate rises from $15 to $18 dollars per hour, and he decides to work 2040 hours. At $18 per hour, if he worked 2200 hours per year, he would be indifferent to his original work decision before the wage increase Then: -Draw a diagram to show Ken’s choices before and after the wage increase. Calculate his maximum and optimal income before and after the wage change. And calculate the substitution effect, income effect and total effect generated by the wage change. Show these three effects in your diagram.arrow_forwardONLY ANSWER C & D Consider a firm with Total Output function (Production Function) given by Q = 6L2 – 0.4L3, where L is variable labor input. The firm is faced with the decision to hire the optimal number of workers in order to maximize its output level. (a) Obtain the Marginal Product function. (b) Find the Average Product function. (c) Determine the level of employment that would maximize the firm’s output level. (d) Verify that the second-order condition is met for the firm's output maximum.arrow_forwardincludes the wages paid to workers, the cost of any benefits the worker receives, and other expenses related to employing a worker. A) The price of labor (B) Marginal revenue product (C) The wage Take-home payarrow_forward
- Labor (workers per day) Total Product (per day) 10 4000 11 4389 12 4752 13 5083 14 5376 15 5625 The firm can hire as many workers as they want at the prevailing market wage of $150 a day per worker. In addition, the firm pays $200 a day for equipment. Enter ONLY numbers. No comma, units, or decimals. 1. What is the marginal product of the 12th worker? 2. What is the average product of hiring 12 workers? 3. What is the total variable cost per day if 12 workers are hired ? 4. What is the total fixed cost per day if 12 workers are hired?arrow_forwardDiscuss how total earnings are determined for both piece-rate and time-rate workersarrow_forward(a) Why does the labour demand curve slope downwards? (b) A garment factory’s production function is provided in the table.The gross profit per unit (difference between selling price and material cost, but not including the cost of labour) is $100. # Workers Output 1 20 2 36 3 48 4 56 5 60 6 62 (i) If the wage rate is $1,000 a week, how many workers should the factory hire? (ii) If a surge in popularity for the factory’s brand allows them to raise the product price such that the gross profit rises to $150, how many workers will the factory hire now? (iii) Calculate the number of garments produced in each of the two cases above. Question 4 Using your knowledge and understanding of supply and demand analysis to graph the following and explain your graph: (a) an increase in labour productivity. (b) an increase in preference for work. (c) the trade union withdraws labour through a strike.arrow_forward
- (a) Why does the labour demand curve slope downwards? (b) A garment factory’s production function is provided in the table. The gross profit per unit (difference between selling price and material cost, but not including the cost of labour) is $100. # Workers Output 1 20 2 36 3 48 4 56 5 60 6 62 (i) If the wage rate is $1,000 a week, how many workers should the factory hire? (ii) If a surge in popularity for the factory’s brand allows them to raise the product price such that the gross profit rises to $150, how many workers will the factory hire now? (iii) Calculate the number of garments produced in each of the two cases above.arrow_forwardThe marginal product of labor is the additional: a) wage paid for an additional hour of work. b) wage paid for an additional worker employed. c) labor employed to produce one more unit of output. d) output produced by one more worker.arrow_forwardMrs. Mei Mei, the owner and manager of the Moora Photocopy Sdn Bhd located near your university, is contemplating to keep her shop open after 6 p.m. and until midnight. In order to do so, she would have to hire additional workers, L. She estimates that the additional workers would generate the following total output, Q (where each unit of output refers to 100 pages duplicated). Workers hired (L) 0 1 2 3 4 5 6 Total product (Q) 0 12 22 30 36 40 42 A. Help Mrs. Mei Mei to calculate the average product (APL) and marginal product (MPL) of the additional worker (please copy the table in your answer). B. Using the VMP rules, how many workers should Mrs. Mei Mei hires if the price of each unit of output is $10 and each workers hired must be paid $40 per day (show the relevant calculation. C. Using MR=MC approach, prove that the number of workers that Mrs. Mei Mei should hire is the same as that obtained in (b).arrow_forward
- A firm in a perfectly competitive labor market is employing labor where the marginal revenue product of the last unit is $25 and the marginal factor cost is $30. Based on this, the firm should A-employ more units of labor. B-employ fewer units of labor. C-employ the same amount of labor D-lower its offered wage for labor. E-increase its offered wage for laborarrow_forwardQ.1.20 An upward-sloping labour supply curve illustrates that ceteris paribus; (a) the quantity of labour supplied and the hours of work per week are directly related.(b) the quantity of labour supplied and the price of labour used to produce output are inversely related.(c) individuals use higher income to buy back leisure time.(d) a greater quantity of labour would be supplied at higher wage rates.arrow_forwardBell’s Furniture, assemblers are paid according to the following differential piece rate scale: 1−20 dressers in a week, $7 each; 21−30 dressers, $9.50 each; and $14 each for every dresser over 30. Liz Henderson assembled 47 dressers in one week. Find her gross payarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Microeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506893Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Microeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...
Economics
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning