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Assume the average worker has 100 hours of leisure and could earn $10 an hour. Suppose the social security disability insurance (DI) program was structured so that otherwise eligible recipients lost their entire disability benefit if they had any labor market earnings at all. Suppose, too, that congress was concerned about the work disincentives inherent in this program, and that the relevant committee was studying two alternatives for increasing work incentives among those disabled enough to qualify for it. Alternative A was to reduce the benefits paid to all DI recipients (from $500 to $300) but make no other changes in the program.
Draw original budget constraint (with a $500 DI benefit) and the budget constraint under alternative A.
Characteristics of the left include all but one of the following: The right exhibits all but one of the following:
Cary has the following utility function: U(X,Y)=10x^2y where X is her consumption of Blu-ray disks with a price of $40 and Y is her consumption of DVDS with a price of $10. She has $900 with which to spend on the two goods. Determine the number of Bl..
What is the amount of five equal annual deposits that can provide five annual withdrawals, where a first withdrawal of $1500 is made at the end of year six and subsequent withdrawals increase at $100 over the previous year's, in the interest rate of ..
Substantive responses use theory, research, and experience or examples to support ideas and further the class knowledge on the discussion topic.
A farmer’s field grows 30 bushels of corn and 10 bushels of beans. The farmer can either consume these crops herself or trade them, with one bushel of beans being traded for one bushel of corn. Graph the farmer’s budget which is the possible combinat..
GDP and the Multiplier Application. Most estimates indicate that the marginal propensity to consume in China is approximately 0.50. If we ignore a rise in the price level generated by a boost in aggregate demand that results from an increase in real ..
Will a monopolist's total revenue be larger with second-degree price discrimination when the batches on which it charges a uniform price are larger or smaller? Why?
If you could, how would you alter the way that GDP is defined and measured in the US? Make one recommendation. Explain what the current practice is, how you would change it, and why your proposed change would be an improvement.
Based on your answer in a and b, how can you reconcile the President's statement with economics? Can you suggest how his statement could be modified to be consistent with teh IS-LM model?
Describe capital and labour productivity in engineering context and pharmaceutical industries in India. Discuss whether Indian Consumer goods industry is growing at the cost of future profitability.
What is the price of a perpetuity that has a coupon of $50 per year and a YTM of 2.5% ? If the YTM doubles, what would happen to its price? Assume you just deposited $1,000 into bank account. The current real IR is 2%, and inflation is expected to be..
An emissions fee is paid to the government, whereas an injurer, who issued and held liable, pays damages directly to the party harmed by an externality. What differences in the behavior of the victims might you expect to arise under these two arr..
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