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Unformatted text preview: Econ 4531 - Spring 2011 Problem Set 2 Deadline: Feb 22nd (during lecture) 1. (10 point each) Review Questions from Chapter 3: Questions 1, and 6; Chapter 4, Question 1. 2. (10 points) Replicate and update Table 3.1, Figure 3.1 and Figure 4.1. 3. (10 points) Obtain the series of employment published by Bureau of Labor Statistics from Household Survey and Employment published by Bureau of Labor Statistics from Establishment Data (use monthly- or quarterly frequency, the sources are the same from that of last problem). Compute the growth rate of these two series. Do these two series tell a similar story in general? What may explain any discrepancy that you can find? Do they tell a similar story during the last recession? 4. (10 points) Suppose the hourly wage is 10 dollars and the price of each unit of capital is 25 dollars. The price of output is constant at 50 dollars per unit. The production function is F ( L,K ) = L . 5 K . 5 If the current capital stock is fixed at 1600 units, how much labor should the firm...
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- Spring '11
- Economics, Bureau of Labor Statistics, wage offer