Suppose That the Salary Range for Recent College Graduates with a Bachelor's

question 78

Multiple Choice

Suppose that the salary range for recent college graduates with a bachelor's degree in economics is $30,000 to $50,000,with 25% of jobs offering $30,000 per year,50% offering $40,000 per year and 25% offering $50,000 per year and that in all other respects,the jobs are equally satisfying.Assume that in this market,a job offer remains open for only a short time so that continuing to search requires an applicant to reject any current job offer.
Moe has just received a job offer that pays $40,000 per year.Moe should

• A)reject the offer and continue to look.
• B)accept the offer if he is risk averse or risk neutral;otherwise continue searching.
• C)accept the offer only if he is risk averse.
• D)accept the offer regardless of his preference for risk.

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Definitions:

Total Cost Curve

A graphical representation that shows how the total cost of production changes as the quantity of output changes.

Output

In economics, this refers to the total amount of goods and services produced by an economic system over a given period.

Total Daily Cost

The complete sum of all expenses incurred by an individual or company in a single day, including both fixed and variable costs.

Cost Of Workers

The total expenses incurred by an employer to compensate employees, including wages, benefits, and any other forms of compensation.