What is average number of efficiency units among immigrants

Assignment Help Business Economics
Reference no: EM13892166

Suppose a worker’s skill is captured by his efficiency units of labor. The distribution of efficiency units in the population is such that worker 1 has one efficiency unit; worker 2 has two efficiency units, and so on. There are 100 workers in the population. In deciding whether to migrate to the United States, these workers compare their weekly earnings at home (w0) with their potential earnings in the United States (w1).

The wage-skills relationship in each of the two countries is given by

w0= 700 + 0.5s

and

w1= 670 + s

where s is the number of efficiency units the worker possesses.

a) Assume there are no migration costs. What is the average number of efficiency units among immigrants? Is the immigrant flow positively or negatively selected?

b) Suppose it costs $10 to migrate to the United States. What is the average number of efficiency units among immigrants? Is the immigrant flow positively or negatively selected?

Reference no: EM13892166

Questions Cloud

Will the free market equilibrium yield an optimal solution : What are the two arguments for government support of secondary education? What is an external benefit? If there is an external benefit in a market, will the free market equilibrium yield an optimal solution?
Current distributions and guaranteed payments : Wilson has a 40 percent interest in the assets and income of the CC&W Partnership, and the basis in his partnership interest is $45,000 at the beginning of 2014. During 2014, the partnership's net loss is $60,000 and Wilson's share of the loss is $24..
Job as a specialist in fighting forest fires : Sally and Joe recently graduated from college, both majoring in history. Joe took a prestigious job as a legal clerk. Sally took a job as a specialist in fighting forest fires. Both received additional training before entering their jobs. Who will li..
Partnership interest immediately after the distribution : Walter receives cash of $18,000 and land with a fair market value of $75,000 (adjusted basis of $50,000) in a current distribution. His basis in his partnership is $16,000. What amount of gain must Walter recognize as a result of the current distribu..
What is average number of efficiency units among immigrants : Suppose a worker’s skill is captured by his efficiency units of labor. The distribution of efficiency units in the population is such that worker 1 has one efficiency unit; worker 2 has two efficiency units, and so on. Assume there are no migration c..
There are two types of farming tractors on the market : There are two types of farming tractors on the market, the FT250 and the FT500. The only difference between the two is that the FT250 is more prone to accidents than the FT500. At these prices, 2,000 of each model are purchased each year. What is the..
What is net annual equivalent uniform annual cost : You continue to use an old machine tool that was bought four years ago for $15,000. It has been fully depreciated but can be sold today for $2,000. The existing (old) machine tool can be sold today for $2,000. You purchase a brand new machine tool at..
Based on your findings regarding leading indicators : You are in charge of making recommendations based on economic forecasts to upper management of your firm, which produces widgets, and employs 2,500 workers. What would you look for in terms of leading indicators (discuss at least three indicators), a..

Reviews

Write a Review

Business Economics Questions & Answers

  Current ratio or the quick ratio as a measure of liquidity

If you were asked to lend money to your cousin’s clothing store to help her through a slow sales period, would you be more interested in looking at the current ratio, or the quick ratio, as a measure of liquidity? Why?

  The market value of a bond will always approach

The market value of a bond will always approach its par value as its maturity date approaches, provided the bond's required return remains constant.

  Short-run supply curve of competitive industry is derived

The short-run supply curve of a competitive industry is derived by. Along the long-run supply curve of an increasing-cost industry that is characterized by perfect competition, all of the following can vary except. For the case of an increasing-cost ..

  Explain what is demand for phone calls

If a 20% decrease in th price of long distancephone calls leads to a 35% rise in the quantity of calls demanded, you may conclude that the demand for phone calls is.

  Disagree on what to do with monetary policy

What happens if the FOMC members DISAGREE on what to do with Monetary Policy? How is a compromise or resolution reached?

  Impacts of government fiscal contractions

Is there much research into the long term impacts of government fiscal contractions? I have heard about 2nd generation unemployed as a result of Thatcher's policies but that is very much anecdotal. What does the literature have to say on the matter?

  International merchandise account balance is positive

If the U.S. international merchandise account balance is positive, then:

  What is the equivalent uniform annual cost of one machine

What is the equivalent uniform annual cost of one machine in years 1 through 7 at an interest rate of 7% per year?

  Assuming that ad valorem tax is negligible

Calculate the Economic Life in STB/month for an oil lease with WI = 100%, NRI = 87.5%, lease operating expense = $5,000 per month, price of oil = $15/STB, price of associated gas = $2.25/Mscf, GOR = 500 scf/STB, oil and gas severance taxes = 7.085%. ..

  Brazil and argentina

Consider that two countries, Brazil and Argentina, have the same rates of investment, population growth, and depreciation. They also have the same levels of capital per worker.

  What is the consumer surplus-producer surplus

Let’s assume the demand for balloons is expressed by P=40-2Q. The supply is P=3Q. What is the equilibrium price and quantity? What is producer surplus? What is the consumer surplus?

  Companies learn from siemens reliance on bribery

What lessons should companies learn from Siemens’ reliance on bribery?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd