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| Teaching Since: | May 2017 |
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| Questions Answered: | 66690 |
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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
Sue is offered a job reshelving books in the University of Montana library fromnoon until 1 p.m. each Friday. Her reservation wage for this task is $10 perhour.
a. If the library director offers Sue $100 per hour, how much economic surpluswill she enjoy as a result of accepting the job?
b. Now suppose the library director announces that the earnings from the jobwill be divided equally among the 400 students who live in Sue’s dormitory.Will Sue still accept?
c. Explain how your answers to parts a and b illustrate one of the incentiveproblems inherent in income redistribution programs.
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