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Assuming Hb= 0 (since B specializes in Home production so no marke time), Tb= 1. Ta=0, Ha=1 A and B are both currently single. They
Assuming Hb= 0 (since B specializes in Home production so no marke time), Tb= 1. Ta=0, Ha=1
A and B are both currently single. They are deciding whether or not they should get married and among other things are considering the effect that marriage will have on the quantity of home commodities that they can produce. While single, A and B each face the following budget and time constraints: BC: x = wh TC: t + h = 1 where h is market hours, w is the market wage. There is a time endowment of 1 unit. If A and B marry, they will face the following budget and time constraints: BCM : X = XA + XB = WAhA + WBhB TCM : tA + hA = 1 TCM : tB + hB = 1 t = tAttB where the superscript M stands for `married'. Now consider, A has a higher market wage than B does: WA = 4WB . B specializes in home production. In the above scenario, the expression for XA in terms of WB and t is O 4WB (2 - t) O 4WB (2 - t) t O 8 WB (2 - t)Step by Step Solution
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