laborexam1f05 - Midterm Examination 1 There are ten...

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Labor Economics Autumn 2005 Lich - Tyler Midterm Examination 1 There are ten short - answer questions worth 4 points apiece. There are five long - answer questions worth 12 points apiece. The space provided should be sufficient to answer each question. Pace yourself, and good luck. Short answer questions ( 30 minutes total ) 1. Why are university students usually not considered unemployed, even though most do not have jobs? 2. There are two important reasons that the measured unemployment rate might incorrectly report the true number of workers who want work but cannot find it. Name and brief explain these. 3. In words, describe the marginal rate of substitution between consumption and leisure. Give the mathematical expression for it.
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Labor Exam 1, page 2 of 2 4. Mr. Pig s utility function is U ! C , L " = C ! L , where C is his weekly consumption and L his hours of leisure. There are 100 hours in the week, and he has $ 250 in unearned income. Calculate his reservation wage. 5. Dr. Leach earns $ X for teaching an economics course. When grading exams, he must make a decision. To grade all exams carefully causes disutility of $ 1000. The alternative choice is to give everyone a 10, but then there s about a 5 % chance that the head of the department will hear about this, and Dr. Leach will lose his job ( and receive no payment for the class ) . Find the wage that would cause Dr. Leach to do his job carefully. 6. Empirically, the labor supply of unmarried men is more responsive to wage
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This note was uploaded on 03/19/2010 for the course ECON 480 taught by Professor Kinlaw during the Spring '08 term at UNC.

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laborexam1f05 - Midterm Examination 1 There are ten...

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