« previous next »

Author Question: If the income effect of a wage increase equals the substitution effect, the labor supply curve is ... (Read 87 times)

cabate

  • Hero Member
  • *****
  • Posts: 537
on: Jun 29, 2018
If the income effect of a wage increase equals the substitution effect, the labor supply curve is horizontal at the equilibrium wage.
 
  Indicate whether the statement is true or false

Question 2

Debbie makes porcelain plates in her home and sells them to the Opus gallery. She spent 400 last month on supplies and made 50 plates. She sold the plates to the gallery at 25 per plate. The gallery sells all the plates for 40 each.
 
  For all of the 50 plates, what is Debbie's total value added? For all the 50 plates, what is the gallery's total value added?
InMicro ¦ Hubbard, O'Brien ¦ 1st Edition
Buy Test-Bank


laurnthompson

  • Sr. Member
  • ****
  • Posts: 334
Reply #1 on: Jun 29, 2018
Answer to Question 1

FALSE

Answer to Question 2

To determine Debbie's value added, we must find the additional market value she gives to the plates. For each plate, this is the difference between the price she charges the gallery and the cost of her raw materials. Her cost per plate is 400/50 or 8. Her value added per plate is 25 - 8 or 17. Her total value added for all 50 plates is 17  50 or 850. The gallery's value added per plate is 40 - 25 = 15. The total value added of the gallery for all 50 plates is 50  15 = 750.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Patients who have undergone chemotherapy for the treatment of cancer often complain of a lack of mental focus; memory loss; and a general diminution in abilities such as multitasking, attention span, and general mental agility.

Did you know?

About 3% of all pregnant women will give birth to twins, which is an increase in rate of nearly 60% since the early 1980s.

Did you know?

In 2010, opiate painkllers, such as morphine, OxyContin®, and Vicodin®, were tied to almost 60% of drug overdose deaths.

Did you know?

On average, someone in the United States has a stroke about every 40 seconds. This is about 795,000 people per year.

Did you know?

Adult head lice are gray, about ? inch long, and often have a tiny dot on their backs. A female can lay between 50 and 150 eggs within the several weeks that she is alive. They feed on human blood.

Primary production increases with an increase in total phosphorus concentration. Primary production increases with an increase in total phosphorus concentration.
Coronary circulation. (A) Coronary vessels portraying the complexity and extent of the coronary circ Coronary circulation. (A) Coronary vessels portraying the complexity and extent of the coronary circ
Oil supply and prices affect the economies of nations Oil supply and prices affect the economies of nations
The Effect of Using PPP on Comparisons of GDP The Effect of Using PPP on Comparisons of GDP
Blood Supply of the Liver Blood Supply of the Liver
Increase in total spending in presidential campaigns, 1976-2020 Increase in total spending in presidential campaigns, 1976-2020
Video: Factors that influence muscle tension - Sarcomere length and force, understretched and overstretched

For a complete list of videos, visit our video library