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Unformatted text preview: PADP 8670 Fertig Fall 2011 UGA Homework 3 Due September 12, 2011 1. Show "crowd-out" graphically. Specifically, show that some people have an incentive to switch from private health insurance to public insurance when it becomes available. Put health insurance on the x-axis and all other goods on the y-axis. Explain in words what your graph is showing. 2. Kristin is a manager at Kroger for a wage of $20 per hour. She has 14 hours a day available for work and other non-sleep activities. Right now, she works 9 hours a day. Draw a labor-leisure diagram for Kristin including the values of her budget constraint's x and y-intercepts. Draw an indifference curve tangent at the appropriate point and label it. Graphically show the effect on Kristin's labor supply (number of hours of work) if Kroger gives Kristin a $2 raise in her hourly wage. Explain the result. Make sure to mention the income and substitution effects in your answer. 3. Assume that a particular Canadian province has a welfare program t...
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This note was uploaded on 01/18/2012 for the course PADP 8670 taught by Professor Staff during the Fall '10 term at UGA.
- Fall '10