Cost-Benefit Analysis A city is trying to estimate the most money it should offer to contractors as an incentive for them to finish a disruptive road project early. The transportation project lengthens transport times by 10 hours per week for 40,000 workers. Assume that all workers are paid $10 per hour in a perfectly competitive labor market. What is the most that the city should pay to the contractors as an incentive for completing the project four weeks early?

Cost-Benefit Analysis A city is trying to estimate the most money it should offer to contractors as an incentive for them to finish a disruptive road project early. The transportation project lengthens transport times by 10 hours per week for 40,000 workers. Assume that all workers are paid $10 per hour in a perfectly competitive labor market. What is the most that the city should pay to the contractors as an incentive for completing the project four weeks early?

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter1: Introduction: What This Book Is About

Section: Chapter Questions

Problem 1.4IP

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Sophia, Victoria, and Eve all would like a place to sit while waiting at their children's bus stop. The neighborhood association is considering installing several park benches at the bus stop. Sophia values the benches at $25, Victoria at $35, and Eve at $42. The park benches and labor for installation cost $100. If they are the only residents who value the benches, what should the neighborhood association do? Do not install the park benches because the costs outweigh the benefits. Install the park benches because the benefits outweigh the costs. Do not install the park benches to prevent the Tragedy of the Commons problem of overuse. Install the park benches because people like places to sit.
A firm is thinking of hiring an additional worker to their organization who can increase total productivity by 100 units a week. The cost of hiring him is $1,500 per week. If the price of each unit is $12, which of the following is correct? Group of answer choices the MR of hiring the worker is $1,500. The MC of hiring the worker is $1,200. The worker should be hired at that wage because the marginal benefit exceeds the marginal cost. All of the above are correct. None of the above is correct.
Sophia, Victoria, and Eve all would like a place to sit while waiting at their children's bus stop. The neighborhood association is considering installing several park benches at the bus stop. Sophia values the benches at $25, Victoria at $35, and Eve at $42. The park benches and labor for installation cost $100. If they are the only residents who value the benches, what should the neighborhood association do? Install the park benches because the benefits outweigh the costs. Install the park benches because people like places to sit. Do not install the park benches to prevent the Tragedy of the Commons problem of overuse. Do not install the park benches because the costs outweigh the benefits. A Moving to another question will save this response. «< Question 24 of 25 Close Window
What factor limits the amount a firm can pay a worker to produce a product?
Cindy is a baker and runs a large cupcake shop. She has already hired 11 employees and is thinking of hiring a 12th. Cindy estimates that a 12th worker would cost her $100 per day in wages and benefits while increasing her total revenue from $2,600 per day to $2,750 per day. Should Cindy hire a 12th worker? 1. Yes. 2. No. 3. You need more information to figure this out.
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