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1. A worker values her leisure at $7 per hour. If she is unemployed, she receives $9 per hour in unemployment benefits. If she is hired to work on a public project, she will be paid $18 per hour (and will forfeit her unemployment benefit). What is: [/b]
a. The social opportunity cost of an hour of her time (the cost that would be entered in an efficiency benefit-cost analysis)? [1 mark]
b. The private opportunity cost of an hour of her time (the wage she would have to be paid to induce her to accept a job)? [1 mark]
c. The total employment benefit per hour that would be entered in the referent group net benefit account if she were employed on a public project? [1 mark]
d. The division of the hourly employment benefit between the worker and the government. [2 marks]
thanks;)
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