please answer all questions thoroughly

Problem 1: True/False/Uncertain (15 pts) Based on the material discussed in class, state whether the statements below are true, false, or uncertain. Most importantly, justify your explanation. (3 pts each) a. Employers are more willing to invest in general skills than specific skills. b. Non-compete agreements could make employers more willing to invest in a worker's skills. c. When firm-specific skills matter for a job, the wage is not necessarily equivalent to the value of the marginal product of labor (VMPL). d. When choosing between a \"safe\" candidate with a proven track record versus a \"risky\" candidate that lacks experience and uncertain skills, employers should choose the \"safe\" candidate. e. In markets where termination rates are high, workers will benefit more from investing in general skills than specific skills. Problem 3: General vs. Specific Skills (20 pts) Aylin works at Lululemon, where she uses her background in recreational sports and her degree in marketing. Target is interested in making her an offer. They only value her background in marketing. The value of the marginal product of her labor at Lululemon (L) is VMPL =25 | 2 2 The value of the marginal product of her labor at Target (T) is 4 VMPLr =20+ She supplies H = 64 hours of labor per week. a. With H on the x-axis, graph Aylin's VM PL for Lululemon and Target on the same graph. (6 pts) b. Solve for the wage offered by Target. Note: this can be a value or a range. (4 pts) c. Solve for the wage offered by Target Note: this can be a value or a range. (4 pt) d. On your graph from part a., label the wages offered by each employer. (2 pts) e. Target decides to expand its athleisure line, so now Aylin's recreational sports background is valuable there too. Her VMPL at Target rises. Assess whether the following statement is true, false, or uncertain. Justify your answer. (2 pts) The wage offer from Target will rise. f. Assess whether the following statement is true, false, or uncertain. Justify your answer. (2 pts) After Aylin's sports recreational background becomes more valuable at Target, Lululemon must raise its wage for Aylin in order to prevent Target from poaching her. Problem 2: Promotions (15 pts) At Bridgestone, workers have two tasks: building tires and developing rubber materials. E denotes the easy task of building tires, while D denotes the difficult task of developing rubber materials. Employees can train by obtaining a master's in chemistry. The variable s denotes training, which takes on a value of 0 if the employee does not have a master's and 1 if the employee has a master's. The cost of the degree in money and time is . The productivity of a worker with training level s at task is given by y;(s), where s is 0 or 1 and i can be E or D. Suppose that the following functions determine productivity: yp(s) = 100 4 20s yp(s) = 108 + Ts Executives at Bridgestone want to introduce a promotion structure that encourages employees to invest in a master's in chemistry. a. Solve for productivity at either task for employees without a master's in chemistry. (3 pts) b. Solve for productivity at either task for employees with a master's in chemistry. (3 pts) c. Suppose that = 12. Can Bridgestone introduce a promotion scheme to ensure that employees will wish to pursue a master's in chemistry? If yes, state the condition on wages (wp,wg) that must be satisfied for both the employee and the employer to be better off from the arrangement. Here, wp is the wage paid for the difficult task, and wg is the wage paid for the easy task. State the intuition behind why the promotion scheme is possible. If not, state the intuition behind why the promotion scheme is not possible. (5 pts) Now suppose that with the development of new technologies, workers will become more productive in developing rubber materials if they have a master's in chemistry. Productivity at the difficult task is now yp(s) = 100 + 30s d. Can Bridgestone introduce a promotion scheme to ensure that employees will wish to pursue a master's degree? If yes, state the condition on wages (wp,wg) that must be satisfied for both the employee and the employer to be better off from the arrangement. Here, wp is the wage paid for the difficult task, and wg is the wage paid for the easy task. State the intuition behind why the promotion scheme is possible. If not, state the intuition behind why the promotion scheme is not possible. (4 pts)