1). Assume that a worker lives only two (2) periods, and is considering an investment in human capital in the form of a one-year professional certification program.The program requires an upfront investment (to cover tuition, books, and other course materials) of $7,500, and completing the program would result in annual earnings of $35,000.

If the opportunity cost of this human capital investment is 15%, what is the Net Present Value (NPV)?

Notes:

Do not use the $ when entering your answer.

Round your answer to the nearest "whole number."For example, $87,567.85 should be entered as 85,568.

2). The market-clearing wage differential between a safe and a risky job is $5,000. Which of the following is FALSE?

a.

The per-worker cost for any firm to change technologies to offer safe jobs in place of risky jobs is $5,000.

b.

The average per-worker cost of offering safe jobs exceeds $5,000at the risky firms.

c.

The marginal worker is indifferent between working the safe orthe risky job.

d.

All but the marginal worker in safe jobs require a wage differential above $5,000 to accept a risky job.