Suppose That Low-Productivity Workers All Have Marginal Products of 10

question 11

Multiple Choice

Suppose that low-productivity workers all have marginal products of 10 and high-productivity workers all have marginal products of 15.The community has equal numbers of each type of worker.The local community college offers a course in microeconomics.High-productivity workers think taking this course is as bad as a wage cut of $2, and low-productivity workers think it is as bad as a wage cut of $4.

• A)There is a separating equilibrium in which high- productivity workers take the course and are paid $15 and low-productivity workers do not take the course and are paid $10.
• B)There is no separating equilibrium and no pooling equilibrium.
• C)There is no separating equilibrium, but there is a pooling equilibrium in which everybody is paid $12.50.
• D)There is a separating equilibrium in which high-productivity workers take the course and are paid $17 and low-productivity workers do not take the course and are paid $10.
• E)There is a separating equilibrium in which high-productivity workers take the course and are paid $15 and low-productivity workers are paid $12.50.

---

Definitions:

Marketing Manager

A professional responsible for planning, directing, and orchestrating a company's marketing policies and campaigns to increase brand awareness and sales.

Monthly Sales

The revenue generated from sales activities during a specific month, often tracked to analyze performance trends.

Break-Even Point

The point at which total costs and total revenues are equal, meaning there is no profit or loss.

Variable Expenses

Expenses that change in proportion to the level of activity or volume, such as raw material costs or utility expenses.