11 - 5 “83h Pr Labor Quiz#5 1 What is the optimal...

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Unformatted text preview: 5 “83h Pr Labor Quiz #5 1. What is the optimal stopping rule for investments in education? H a. Firms continue educating workers until the MB=MC. . Mi; 1. Workers continue education until MRRID. 0 3 3'55 (’3 “Firms continue educating workers until MRRzMC. (1. Workers continue education until MU=MC. 2. How do differences in discount rates lead to differences in schooling and earnings? @Workers with higher discount rates get less schooling and have lower earnings.“ b. Workers with higher discount rates get less schooling but have higher/earnings. c. Workers with higher discount rates get more schooling but have lower earnings. d. Workers with higher discount rates get more schools and have higher earnings. e. Wookies have high discount rates and high earnings. 3. ”Ability bias” is best described as: a. Workers of higher ability tend to enter the labor force later.“ " b. Workers of higherability tendto entepthe"l‘aborforce sooner. @ Workers of higher abilitytend to get more education; d. Workers 9fhigher~abilityEmit?“Sfilléifiaeducatipn. $31 4. What is the difference between a “pooling equilibrium" and a ”separating equilibrium”? ‘ ' In a separating equilibrium, different workers are attracted to different types of firms. « b‘. In a pooling equilibrium, firms’ beliefs about workers are robust to variations in behavior. c. In a separating equilibrium, all workers are worse off than in a pooling equilibrium. {Q In a separating equilibrium, firms’ beliefs cause different workers to behave differently. X 5. In the signaling model of schooling, which of the following is true? - [email protected] The private rate of return to schooling is positive, while the seciaLrate of return is negative. b The social rate of return to schooling is greater thanwthe..private rate of return. @he social rate of return to schooling incorporates externalities that are overlooked by the private rate of return. d. The social rate of return to schooling must always equal the private rate of return, in equilibrium. 6. Who pays for, and who benefits from, general training? Workers pay for general training, and workers get the benefit. . Firms pay for general training, and firms get the benefit. c. Firms pay for general training, and workers and firms share the benefit. d. Workers and firms share the costs and benefits of general training. 7. Who pays for, and who benefits from, specific training? a. Workers pay for specific training, and workers get the benefit. b. Firms pay for specific training, and firms get the benefit. c. Firms pay for specific training, and workers and firms share the benefit. @ Workers and firms share the costs and benefits of specific training. ...
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