Question

Roberto works in a factory making electric cars. Currently, his firm pays him $35 per hour...

Roberto works in a factory making electric cars. Currently, his firm pays him $35 per hour and he works 35 hours per week. Each hour he works he experiences disutility of effort from working valued at $5 per hour. In addition, should Roberto lose his job the government will pay him an unemployment benefit of $15 per hour, for each hour he would otherwise work each week, for a maximum of 20 weeks. Prior to the coronavirus pandemic if Roberto lost his job the expected duration of unemployment before he would find another job is 10 weeks.

(a) Calculate Roberto's (i) employment rent per hour and his (ii) total employment rent.

b) With the advent of the coronavirus pandemic the economy has gone into recession causing Roberto's expected duration of unemployment to increase to 30 weeks.

Furthermore, the dramatic increase in the expected duration of unemployment has resulted in psychological stress from unemployment valued at $3 per hour.

In the light of these developments re-calculate Roberto's:

(i) Employment rent per hour and

(ii) Total employment rent .

(Hint: It will be necessary for students to base their calculations on two periods, the first, covering weeks 1-20, when the unemployment benefit is available and the second, covering weeks 21-30, when the unemployment benefit is not available)

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Roberto works in a factory making electric cars. Currently, his firm pays him $35 per hour...
Roberto works in a factory making electric cars. Currently, his firm pays him $35 per hour and he works 35 hours per week. Each hour he works he experiences disutility of effort from working valued at $5 per hour. In addition, should Roberto lose his job the government will pay him an unemployment benefit of $15 per hour, for each hour he would otherwise work each week, for a maximum of 20 weeks. Prior to the coronavirus pandemic if Roberto...
With an initial wage rate of $15 per hour, Thomas works 35 hours per week and...
With an initial wage rate of $15 per hour, Thomas works 35 hours per week and leisures the remaining 75 hours. When his wage increases to $20 per hour he works 45 per week and when the wage increases to $25 heworks 40 hours per week. What is Thomas’ labor supply elasticity as his wage increases from $15 to $20 and then from $20 to $25? What does this value tell you about the shape of his labor supply curve...
2. Henry works in a movie theater and his wage is initially $12 per hour and...
2. Henry works in a movie theater and his wage is initially $12 per hour and he usually works 30 hours per week. Henry’s boss gives him a raise and his wage increases to $15 per hour. Henry now decides to work 33 hours per week. (a) What is Henry’s labor supply elasticity? (b) Is Henry’s labor supply curve inelastic or elastic? Explain what this means in a few words. (c) Explain whether the income or substitution effect dominated after...
Project 1 Prepare job costing information for the following: Joseph runs an electrical contracting business and...
Project 1 Prepare job costing information for the following: Joseph runs an electrical contracting business and employs six electricians. He is only involved in supervision but on occasion will assist if needed. He charges direct labour hours at $45.00 per hour. Three of Joseph’s electricians are working on a job that involves wiring and fitting fixtures in a new house for Mr and Mrs Fleet. All materials and fixtures used have come from inventory. Each electrician spends half an hour...
1. In which phase of the business cycle is the U.S. economy currently in? ________________. How...
1. In which phase of the business cycle is the U.S. economy currently in? ________________. How many months has the U.S. economy been in this stage of the business cycle? ___________ months 2. How long has the current expansion/recovery lasted to date? _________________ How does this compare to the average length of U.S. recessions since 1854? ______________________________. 3. What do the last four recoveries/expansions (that is, the current recovery/expansion and the previous three recovery/expansions), suggest about a new trend in...
Scenario Pigs R Us is a second generation, family-owned Richmond-based company with about 400 employees. It...
Scenario Pigs R Us is a second generation, family-owned Richmond-based company with about 400 employees. It slaughters, manufactures, and sells pork food products.  Pigs R Us (PRU) is a low-tech, hands-on, “bricks and mortar” type of company with solid brand recognition, an impeccable reputation for high quality and ethical standards. The processes used in manufacturing are with the highest ISO20002 standards, and the plant is maintained immaculately. The personnel are comprised of an older work force (average employee age is late...
QUESTION 1 1. Brianna is trying to increase her chances of being promoted to vice president...
QUESTION 1 1. Brianna is trying to increase her chances of being promoted to vice president by working to build good work relationships with other managers outside her own department. Brianna's behavior should be viewed as dysfunctional politics. functional politics. coercive power. functional influence. 2 points QUESTION 2 1. The Gingerbread Factory has a separate unit that makes their chocolate crunch cookies and another unit that is completely responsible for all operations in producing their ginger snap cookies. The Gingerbread...
2. SECURING THE WORKFORCE Diversity management in X-tech, a Japanese organisation This case is intended to...
2. SECURING THE WORKFORCE Diversity management in X-tech, a Japanese organisation This case is intended to be used as a basis for class discussion rather than as an illustration of the effective or ineffective handling of an administrative situation. The name of the company is disguised. INTRODUCTION In light of demographic concerns, in 2012, the Japanese government initiated an effort to change the work environment in order to secure the workforce of the future. Japan is world renowned for its...
3 SECURING THE WORKFORCE Diversity management in X-tech, a Japanese organisation This case is intended to...
3 SECURING THE WORKFORCE Diversity management in X-tech, a Japanese organisation This case is intended to be used as a basis for class discussion rather than as an illustration of the effective or ineffective handling of an administrative situation. The name of the company is disguised. INTRODUCTION In light of demographic concerns, in 2012, the Japanese government initiated an effort to change the work environment in order to secure the workforce of the future. Japan is world renowned for its...
Delta airlines case study Global strategy. Describe the current global strategy and provide evidence about how...
Delta airlines case study Global strategy. Describe the current global strategy and provide evidence about how the firms resources incompetencies support the given pressures regarding costs and local responsiveness. Describe entry modes have they usually used, and whether they are appropriate for the given strategy. Any key issues in their global strategy? casestudy: Atlanta, June 17, 2014. Sea of Delta employees and their families swarmed between food trucks, amusement park booths, and entertainment venues that were scattered throughout what would...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT