laborexam3f07

laborexam3f07 - Labor Exam 3 Dec. 7, 2007 By writing your...

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Labor Exam 3 By writing your PID below, you are indicating Dec. 7, 2007 your intention to abide by the honor pledge: PID: This exam consists of ten short questions ( worth four points apiece ) and six long questions ( worth twelve points each ) , for a total of 112 points. You have 120 minutes to answer all completely and clearly in the space provided. Short Questions 1. What is the ability bias ? 2. How does the interest rate ( or a worker s internal rate of return ”) affect migration decisions? 3. Discrimination can have an effect on workers earnings in the long run if it depends on whose tastes?
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4. This question is about efficiency wages. A firm has the option to pay a worker a low wage of $ W or a high wage of $( W + H ) . A worker has the choice to work hard, causing disutility of C , or to shirk, causing no disutility. When he works hard, he produces P for the firm ( which is much more than C ) . If this relationship lasts only a single period, what would we predict as the outcome of the game ? 5. Name the two types of fixed costs of working, and explain how each affects hours
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laborexam3f07 - Labor Exam 3 Dec. 7, 2007 By writing your...

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