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Suppose a country's government is concerned about growing inequality of incomes and wants to undertake a program that will increase the total earnings of the unskilled. It is considering two alternative changes to its current payroll tax, which is levied on employers as a percentage of the first $117,000 of employee earnings:
a) Extending employer payroll taxes to all earnings over $117,000 per year and increasing the cost of capital by eliminating certain tax deductions related to plant and equipment.
b) Reducing to zero employer payroll taxes on the first $50,000 of earnings but taxing employers on all employee earnings between $50,000 and $117,000 (there would be no taxes on earnings above $117,000). Analyze proposal (a) and proposal (b) separately (one, but not both, will be adopted). Which is more likely to accomplish the aim of increasing the earnings of the unskilled? Why?
q.consider once again the microchip market. demand for microprocessors is given by p 35 - 5q. where q is the quantity
A pure competitive star industry consists of a large number of independent firms producing a standardized product A. determines the average cost function? Define the profit function for the company that is at an equilibrium position if we know,that t..
q.consider the application of the demand-revealing process to land assembly that we discussed in class. we defined d as
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Susie's boss offers her $100 to come to work instead. In considering what to do, which of the above would be considered a sunk cost.
What would be good textbooks at the graduate level that deal with Labor Economics and Labor-Macro (As in, Equilibrium Unemployment Theory, Shimer Puzzle etc)?
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Due to a recession, demand for housing market decreases. Will this shift labour supply curve, demand curve or both. How will this affect wages and number of workers in home construction.
Agricultural markets are often cited as exhibiting the characteristics of the perfect competition market structure. Does farming fit this model?
what money growth rate should the Fed aim for to hit its inflation target in that period? If the Fed instead maintained the money growth rate from part a, what is likely to happen to inflation.
Converse the latest equilibrium price also quantity to result from these changes.
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