LABOR ECONOMICS
8th Edition
ISBN: 9781260004724
Author: BORJAS
Publisher: RENT MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 5, Problem 12P
To determine
Determine who will choose to be a trash collector for the better function of the economy.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
who has a greater opportunity cost of enjoying leisure- a janitor or a brain surgeon? Explain. can this help explain why doctors work such long hours.
Given your experience and what you have learned from the chapter, consider what factors are likely to lead to a high income.
Using your knowledge, identify each of the given statements as true or false.
True
Starting a business is the easiest way to earn a high income.
Answer Bank
Many people will experience poverty at some point in their lifetimes.
If your parents earned higher incomes than average, you are more likely to earn a higher than average income.
False
Obtaining a master's degree guarantees you a higher income than just possessing a high school diploma.
Who has a greater opportunity cost of enjoying leisure- a janitor or brain surgeon? Explain. Can this help explain why doctors works such long hours?
Knowledge Booster
Similar questions
- A recent trend in health insurance is the Health Savings Account (HSA). The idea behind Health Savings Accounts is that rather than providing employees with health insurance that makes visiting doctors cost little more than a simple $10 or $20 copay the employer gives the employee money to use to spend on health care, but the employee bares the entire cost of seeing the doctor. What money given for health care not spent by the employee can be withdrawn by the employee as if it was additional income. It is believed that Health Savings Accounts will reduce the total amount of money spent on seeing doctors. Using Supply and Demand analysis, explain why there is the expectation that HSA’s will reduce spending on doctors.arrow_forwardSuppose that there are exactly two types of workers in LA: A’s and B’s. A’s earn a firm $15 in revenue (in their lifetime) and B’s earn a firm $10 in revenue (in their lifetime). There are equal numbers of each type of worker in LA. Firms cannot distinguish between the two types of workers. Even after a firm has hired them, the firm won’t be able to monitor their work closely enough to determine which workers are of which type. Workers prefer a higher wage to a lower wage and workers supply their labor (to the highest possible wage they can get) as long as this wage is positive. A firm pays a worker a wage equal to the expected amount of revenue the worker earns for the firm (in his/her lifetime). Workers are risk neutral. Question 15 : What is the wage (per lifetime) that a type A worker receives? What is the wage (per lifetime) that a type B worker receives?arrow_forwardWhen there is increase in the production, we normally increase the labour rather than the machinery. The more labour employed in the production process, there will be raise in the production, But continuous increase in the labour may lead to decrease in the production after certain point. Here comes the question. How many employees should be employed to get maximum production? Law of variable proportion answers the question of the employment of labour for optimum production? Explain the Law of Variable Proportions in detail?arrow_forward
- Firms compensate workers with "benefits" in addition to wages and salaries. The most prominent benefit offered by many firms is health insurance. Suppose that in 2010, workers at one steel plant were paid $35 per hour and in addition received health benefits at the rate of $7 per hour. Also suppose that by 2020 workers at that plant were paid $36.75 per hour but received $31.50 in health insurance benefits. Instructions: Enter your answers rounded to 1 decimal place. a. By what percentage did total compensation (wages plus benefits) change at this plant from 2010 to 2020? Total compensation increased by %. What was the approximate average annual percentage change in total compensation? % b. By what percentage did wages change at this plant from 2010 to 2020? Wages increased by %. What was the approximate average annual percentage change in wages? % c. If workers value a dollar of health benefits as much as they value a dollar of wages, by what total percentage will they feel that their…arrow_forwardExplain your answer comprehensively about the question stated below: Suppose Congress were to mandate that all employers had to offer their employees a life insurance policy worth at least $50,000. Use Economic Theory and concepts, both positively and normatively, to analyze the effects of this mandate on employee well-being. What effect does this mandate have on the demand for labor? Use also curve to demonstrate the answer.arrow_forwardIn the United States, the working-age population does not include people: Multiple Choice in the military. who are 16 years of age. who do not have a driver’s license. who are 65 years of age. The labor supply curve: Multiple Choice shows the relationship between the total quantity of labor supplied by all firms in the economy and the wage rate. shows that, all things being equal, more workers will want to work when wages are higher and fewer will want to work when wages are lower. has a negative slope. All of these are true.arrow_forward
- What would happen to wages and number of individuals employed in that market if new law required all businesses in that market and other markets to provide their employees a better health insurance policy? Why? Use your analysis to explain who actually pays the costs of health insurance premiums in competitive labor markets.arrow_forwardThere are four types of people: 1. Type 1 (100): Can earn $5 per hour 2. Type 2 (400): Can earn $10 per hour 3. Type 3 (400): Can earn $25 per hour 4. Type 4 (100): Can earn $100 per hour Washington B.C. is a city with 1,000 people. People who work work 40 hours per week. People choose how many weeks they work and can work up to 50 weeks per year. Washington B.C. initially has no tax and transfer programs. Continue to assume no Washington income tax, and Washington has a $4M grant to spend. Zoe Wu tells the mayor that a means-tested program would allow the poor to get more money. She suggests that benefits should be redunced by $10 for each $100 in workers’ pre-tax income. 1. Suppose the guarantee rate is G. How much benefit would each group get at their original income (working 40 weeks) in terms of G? 2. With the $4M grant, how large can G be? How much benefit does each group get? What is the maximum income in the phase-out region? 3. Draw the benefit schedule with labels. 4.…arrow_forwardSuppose the government of Marina decides to pay for public radio by taxing people on the basis of the number of hours they listen to it. In order to determine the tax, it decides to conduct a survey. However, if the survey is based on voluntary self-reporting. which of the following is likely to happen? In order to evade taxes, individuals may shift from the formal, reported economy to an underground, "off the books" economy. Many individuals may understate the number of hours they listen to public radio to government in order to reduce their tax bill. c. People who report many hours of listening may pay a small proportion of their income in public radio tax. Many individuals may overstate the number of hours they listen to public radio to government in order to receive a lower tax bill. e. Individuals with higher incomes may pay lower taxes than individuals with lower income.arrow_forward
- Refer to the News Wire to answer one question. NEWS WIRE: UNEQUAL WAGES Most Lucrative College Degrees College graduation does improve a person's income prospects. But all graduates aren't treated equally: What you majored in counts for a lot. Annual salary surveys by PayScale Incorporated confirm that a student majoring in engineering can expect to earn nearly twice the salary of a philosophy major. What Does Your Major Pay? Major Electrical Engineering Petroleum Engineering. Chemical Engineering Computer Science Nursing Math Economics Astronomy Finance Political Science Philosophy Nutrition English Education Theatre Social Work Median Starting Salary $ 101,200 92,300 74,500 70,700 61,700 59,600 58,200 54,800 53,400 52,200 48,700 45,000 43,600 41,800 39,700 36,600 Source: "College Salary Report, PayScale, 2020, www.payscale.com. Assuming that a college graduate on average earns her MRP, what is the MRP for a newly hired Economics major in 2020? Instructions: Enter your response as a…arrow_forwardIn 2000, the ratio of people age 65 or older to people ages 20 to 64 in Ecocountry was 38,4 %. In the year 2060, this ratio is expected to be 56,8 %. Assuming a pay as-you-go Social Security system, What change in the payroll tax rate between 2000 and 2060 would be needed to maintain the 2000 ratio of benefits to wages? If the tax rate were kept constant, what would happen to the ratio of benefits to wages? What other policies can be used for Social Security Reform?arrow_forwardThere are 81 white seniors graduating from high school and 27 black seniors. a. All of the students with high school degrees apply to UW – Milwaukee. The admissions office looks at their records, and finds that 30% of black students drop out after the first year, compared to 15% of white students. If they have 85 openings, how many of each type of student should the admissions office hire to maximize their graduation rate? b. Suppose there is no difference in graduation rates between black and white students. However, the admissions office wants students who will get good grades. They don’t have access to grade histories of different students, but they can see that all 26 of the 27 black applicants went to high school in Milwaukee, whereas 70 of the 81 white applicants went to schools in the suburbs. The schools in the suburbs have very good academic ratings, whereas the schools in Milwaukee do not. If they have 85 openings, how many of each type of student should the admissions…arrow_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