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Econ 339 Fall 2009 Problem Set 5

Econ 339 Fall 2009 Problem Set 5 - figures she would be...

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Econ 339 Fall Quarter 2009 Problem Set 5 Due Date: 11/4/2009 Solve the following Problems. Show your work. 1. Chapter 7 Problems: 7-3, 7-11 2. Chapter 8 Problems: 8-1 3. Nick and Jane are married. They currently reside in Minnesota. Nick’s present value of lifetime earnings in his current employment is \$300,000, and Jane’s present value is \$200,000. They are contemplating moving to Texas, where each of them would earn a lifetime income of \$260,000. The couple’s cost of moving is \$10,000. In addition, Nick very much prefers the climate in Texas to that in Minnesota, and he figures that the change in climate is worth an additional \$50,000 to him. Jane, on the other hand, prefers Minnesota’s frigid winters, so she

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Unformatted text preview: figures she would be \$50,000 worse off because of Texass blistering summers. Should they move to Texas? 4. Inequality can also be measured in terms of consumption. Would you expect consumption in the U.S. to be more or less equal than wages/income? 5. I uploaded a paper titled Polarization of the U.S. Labor Market to Blackboard. What do the authors mean by Polarization and what phenomenon do they explain? 6. Compare the wage growth 1963-2003 for workers below the 30 th percentile between men and women. 7. Why did the College-High School premium decrease in the 70s?...
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