Structural unemployment is often caused by
A. the recessionary stage of the business cycle.
B. changes in economic organization and production which make some jobs and job skills obsolete.
C. new labor force entrants.
D. striking workers.
E. layoffs associated with seasonal slowdowns in construction and other industries.
B. changes in economic organization and production which make some jobs and job skills obsolete.
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Bobby is buying slices of pizza and place a value of his utility of the first slice at $5; a second slice at $4, and a third slice at $2. If Bobby eats three slices of pizza for lunch, his total utility is equal to
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Arlene quits her $125,000-a-year job to take care of her ailing parents. What is the opportunity cost of her decision?
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You have been hired by an attorney to perform an economic analysis of lost wages in a wrongful death suit. The case involves an insurance agent, John Doe, who was killed in an auto accident a few days after his 59th birthday. Mr
Doe could have expected to earn $75,000 this year. Data suggest that the income of insurance agents has risen an average of 6% over the past 20 years. Mr. Doe's expected retirement age was 65, i.e., on his 65th birthday. Available data provide the mortality rates given below for individuals of Mr. Doe's sex and occupation at various ages. Ten percent appears to be the appropriate discount rate. Age Mortality Rate 59 0.06 60 0.075 61 0.09 62 0.10 63 0.12 64 0.15 65 0.16 a. Calculate the present discounted value of Mr. Doe's expected earnings stream. (For simplicity, assume he receives all of his earnings for the preceding year on his birthday.) b. The attorney has asked your advice regarding a minimum figure that should be accepted as an out-of-court settlement. What guidance can you give the attorney? Would additional information allow you to give the attorney a more precise estimate of the figure that should be accepted? Give an example of how more information would help. c. You must be prepared for cross-examination by the defendant's attorney. Where would you expect the opposing attorney to attack your testimony?