# HW 4 - Shayon Mazumder Econ 640 HW #4 11/12/2008 1. a)...

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Shayon Mazumder Econ 640 HW #4 11/12/2008 1. a) PV mb = -15,000 + 472,000/(1 + .05) = 434,500 PV cp = -40,000 + 500,000/(1 +.05) = 436,200 Debbie chooses to be a concert pianist b) PV mb = -15,000 + 472,000/(1 + .15) = 395,400 PV cp = -40,000 + 500,000/(1 + .15) =394,800 Debbie chooses to be a Marine biologist c) PV cp = -60,000 + 500,000/(1 + .05) = 416,200 Debbie chooses to be a Marine biologist 2. Years of Schooling Earnings MRR 6 10,000 7 12,800 28.0 8 16,000 25.0 9 18,500 15.6 10 20,350 10.0 11 22,000 8.1 12 23,100 5.0 13 23,900 3.5 14 24,000 0.4 Optimal stopping rule means that the MRR= Discount Rate therefore: B) 12 years of schooling C) 10 years of schooling 3.

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a) Dealing with an immigrant who is highly skilled in technology or engineering paired with an American worker who is knowledgeable on a different aspect that will combine to create a final product b) 4. When Mexicans move to Miami, supply shifts to the right at S1, lowering wage to W1 and point B. When the natives realize they can get a higher wage
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## This note was uploaded on 04/28/2011 for the course CS 191 taught by Professor Shen during the Spring '06 term at University of Missouri-Kansas City .

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HW 4 - Shayon Mazumder Econ 640 HW #4 11/12/2008 1. a)...

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