Problem
Suppose the wage rate that is paid at a particular firm is W = 5 + 0.5T, where T = the number of years that the worker has been employed at the firm. The marginal revenue product, which is measured in dollars per hour, is MRPL = 6 + 0.3T. Assume that the wage is high enough to attract workers from alternative jobs.
a. Ignoring the discounting of future values to the present, graph the wages and MRPL over a period of 12 years.
b. Would this pay scheme be more attractive to (a) a worker who is looking for stable employment with the same firm for the next 12 years or (b) a worker who plans to move to another geographic area in six years, which would necessitate leaving his or her job? Explain.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.