This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Which of the following best explains why the elasticity of supply of labor for an individual with a ... (Read 36 times)

azncindy619

  • Hero Member
  • *****
  • Posts: 562
on: Jul 1, 2018
Which of the following best explains why the elasticity of supply of labor for an individual with a Cobb-Douglas utility function (for consumption and leisure) is zero?
 a. Income and substitution effects are precisely offsetting.
  b. The elasticity of substitution of leisure for consumption is zero.
  c. Leisure is an inferior good.
  d. Consumption is subject to diminishing marginal utility.

Question 2

You offer an extended warranty for your product that is purchased by a few customers. If the product typically fails 2 of the time, the claim rate will exceed 2 of warranty purchasers because
 a. adverse selection will lead those who are more reckless to purchase the warranty
  b. moral hazard will lead those who purchase to be more reckless
  c. you systematically underestimate product failure rates
  d. A and B


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Shshxj

  • Sr. Member
  • ****
  • Posts: 335
Reply #1 on: Jul 1, 2018
Answer to Question 1

a

Answer to Question 2

d


azncindy619

  • Member
  • Posts: 562
Reply 2 on: Jul 1, 2018
YES! Correct, THANKS for helping me on my review

flexer1n1

  • Member
  • Posts: 373
Reply 3 on: Yesterday
Gracias!

« previous next »
 

Did you know?

Although the Roman numeral for the number 4 has always been taught to have been "IV," according to historians, the ancient Romans probably used "IIII" most of the time. This is partially backed up by the fact that early grandfather clocks displayed IIII for the number 4 instead of IV. Early clockmakers apparently thought that the IIII balanced out the VIII (used for the number 8) on the clock face and that it just looked better.

Did you know?

To combat osteoporosis, changes in lifestyle and diet are recommended. At-risk patients should include 1,200 to 1,500 mg of calcium daily either via dietary means or with supplements.

Did you know?

IgA antibodies protect body surfaces exposed to outside foreign substances. IgG antibodies are found in all body fluids. IgM antibodies are the first type of antibody made in response to an infection. IgE antibody levels are often high in people with allergies. IgD antibodies are found in tissues lining the abdomen and chest.

Did you know?

Vampire bats have a natural anticoagulant in their saliva that permits continuous bleeding after they painlessly open a wound with their incisors. This capillary blood does not cause any significant blood loss to their victims.

Did you know?

Everyone has one nostril that is larger than the other.

How the law of segregation of alleles explains Mendel's observed ratios How the law of segregation of alleles explains Mendel's observed ratios
An individual's performance can be limited by environmental conditions, such as temperature. Ac An individual's performance can be limited by environmental conditions, such as temperature. Ac
A nearly motionless individual, alert to danger, will whistle when alarmed to warn other groundhogs A nearly motionless individual, alert to danger, will whistle when alarmed to warn other groundhogs
Proportion of Women and Men in the U.S. Labor Force Proportion of Women and Men in the U.S. Labor Force
Who's Policing the Food Supply? Who's Policing the Food Supply?
Blood and Nerve Supply of Bone Blood and Nerve Supply of Bone
Video: Chemical Changes

For a complete list of videos, visit our video library