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Labor Economics 5th Edition by George Borjas
Edition 5ISBN: 978-0073511368Labor Economics 5th Edition by George Borjas
Edition 5ISBN: 978-0073511368 Exercise 25
Suppose the marginal revenue from search is
MR = 50 - 1.5 w ,
where w is the wage offer at hand. The marginal cost of search is
MC = 5 + w.
(a) Why is the marginal revenue from search a negative function of the wage offer at hand
(b) Can you give an economic interpretation of the intercept in the marginal cost equation; in other words, what does it mean to say that the intercept equals $5 Similarly, what does it mean to say that the slope in the marginal cost equation equals one dollar
(c) What is the worker's asking wage Will a worker accept a job offer of $15
(d) Suppose UI benefits are reduced, causing the marginal cost of search to increase to MC = 20 + w. What is the new asking wage Will the worker accept a job offer of $15
MR = 50 - 1.5 w ,
where w is the wage offer at hand. The marginal cost of search is
MC = 5 + w.
(a) Why is the marginal revenue from search a negative function of the wage offer at hand
(b) Can you give an economic interpretation of the intercept in the marginal cost equation; in other words, what does it mean to say that the intercept equals $5 Similarly, what does it mean to say that the slope in the marginal cost equation equals one dollar
(c) What is the worker's asking wage Will a worker accept a job offer of $15
(d) Suppose UI benefits are reduced, causing the marginal cost of search to increase to MC = 20 + w. What is the new asking wage Will the worker accept a job offer of $15
Explanation
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Verified
a) Marginal revenue as a negative functi...
Labor Economics 5th Edition by George Borjas
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