Use Indifference Curve and Constraint Analysis to Analyze the Behavior

question 45

Essay

Use indifference curve and constraint analysis to analyze the behavior of employees who are paid
a.An hourly wage rate of $4 per hour.
b.A fixed hour wage of $4 per hour; plus an overtime bonus of $4 for every hour worked in excess of eight hours.
c.A fixed salary of $40 per day, plus $4 for each hour worked.
d.Which of the above schemes would yield the largest number of hours worked? Explain.

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Definitions:

Adrenal Glands

Glands located on top of the kidneys that produce a variety of hormones including adrenaline and cortisol.

Bloodstream

The flowing blood within the circulatory system of the body, carrying oxygen, nutrients, and waste materials.

Epinephrine

A hormone and a neurotransmitter also known as adrenaline, which is released in response to stress and works by increasing heart rate, contracting blood vessels, and dilating air passages.

Bloodstream

The flowing body fluid that carries oxygen, nutrients, and waste products to and away from cells within an organism, primarily consisting of plasma, red and white blood cells, and platelets.