11.2 Compensation Sequencing Question Creative Accountants (CA) LLC is a large national accounting firm. The company's main source of accountants is to hire business degree graduates, with an accounting major, right after they are done university. CA then supports/pays for these new workers to obtain their Chartered Professional Accounting (CPA) designation. Part of CA's strategy is to pay these young accountants low wages, typically below their marginal revenue product (MRP). CA then pay higher wages, typically above their MRP, to their accountants later in their careers as they gain more experience. The above can be described by two equations: MRP = 30 +0.17 W = 28 +0.2T Where: T= # of years of service CA has been successful at attracting and retaining accountants. The expected tenure of a typical accountant at CA is 35 years. Assume the discount rate is 0% (i.e. you don't have to calculate net present value to solve the questions below). Use the above to answer the following questions. a) How many years will CA underpay its workers and how many years will it overpay? At what year will MRP = W? b) Is CA's employment strategy profitable? Why or why not? c) Draw the MRP-Wage Graph from a) and b). d) is the type of pay scheme attractive for new accountants coming out of university? Why or why not