Question: A worker values her leisure time at $7 per hour. She is offered work on a public project at a wage of $22 per hour,
A worker values her leisure time at $7 per hour. She is offered work on a public project at a wage of $22 per hour, but if she accepts she will forfeit unemployment benefits equivalent to $13 per hour. Identify:
i the private opportunity cost of her time;
ii the social opportunity cost of her time;
iii the employment benefit to the economy per hour of her time on the project;
iv the portion of the employment benefit accruing to the government.
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