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3. Suppose Jack’s wage rate is $20 and that he can produce $10 per hour of...

3. Suppose Jack’s wage rate is $20 and that he can produce $10 per hour of household “goods”. Suppose Jill’s wage rate is $30 and that she can produce $15 per hour of household “goods”. Who should specialize in the market sector? Suppose now, Jack’s wage goes up to $25 per hour. How does this affect the answer?

4. Suppose the government grants $2500 per child to households that have more than 2 children. How would this affect fertility?

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