Refer to the table on the next page. Assume that we start out with 3 workers...

 

Transcribed Image Text:

Refer to the table on the next page. Assume that we start out with 3 workers employed in market A and 8 workers employed in market B. Also assume perfect information and mobility is costless (along with other assumptions we made about a similar problem in class). If we have all of our assumptions, with migration how many workers will work in market A? Labor Market A Workers VMP Annual Wage VTP 1 2 3 456789 10 $100,000 $100,000 $95,000 $195,000 $90,000 $285,000 $85,000 $370,000 $80,000 $450,000 $75,000 $525,000 $70,000 $595,000 $65,000 $660,000 $60,000 $720,000 $55,000 $775,000 Labor Market B Workers VMP Annual Wage VTP 1 2 3 4 5 6 7 8 9 10 $85,000 $85,000 $80,000 $165,000 $75,000 $240,000 $70,000 $310,000 $65,000 $375,000 $60,000 $435,000 $55,000 $490,000 $50,000 $540,000 $45,000 $585,000 $40,000 $625,000 Answer Refer to the previous question. The value of the total product for society before the migration happened is: Refer to the table on the next page. Assume that we start out with 3 workers employed in market A and 8 workers employed in market B. Also assume perfect information and mobility is costless (along with other assumptions we made about a similar problem in class). If we have all of our assumptions, with migration how many workers will work in market A? Labor Market A Workers VMP Annual Wage VTP 1 2 3 456789 10 $100,000 $100,000 $95,000 $195,000 $90,000 $285,000 $85,000 $370,000 $80,000 $450,000 $75,000 $525,000 $70,000 $595,000 $65,000 $660,000 $60,000 $720,000 $55,000 $775,000 Labor Market B Workers VMP Annual Wage VTP 1 2 3 4 5 6 7 8 9 10 $85,000 $85,000 $80,000 $165,000 $75,000 $240,000 $70,000 $310,000 $65,000 $375,000 $60,000 $435,000 $55,000 $490,000 $50,000 $540,000 $45,000 $585,000 $40,000 $625,000 Answer Refer to the previous question. The value of the total product for society before the migration happened is: