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The market wage rates for left-and right-handed workers are $10 and $15 per worker, respectively. The value of the marginal product of labor is 20 – 0.5L, where L is the total number of workers (it doesn’t matter if they’re left or right-handed).
a) What are the profit-maximizing levels of employment of left- and right-handed workers (how many of each would a nondiscriminatory employer hire)? If an employer has a discrimination coefficient of 0.7 against left-handed people, how many left- and right-handed workers does the employer hire?
b) If the price of output is 1, output is given by 20L – 0.25L2, and the only costs to the firm are its labor costs, what are the profits to a non-discriminatory employer? What are the profits of the employer who has a discrimination coefficient of 0.7?
A friend wants your advice. His aunt recently left him $100,000 that he must invest in one or both of two different corporations. The current price per share of each is $100. If your friend buys 1000 shares of the first corporation, what will be the ..
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can increase the natural rate of unemployment. Is this something that policymakers should be concerned with? Explain.
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