Problem 4 Suppose the market for discrete job risk consists of multiple heterogeneous workers and multiple heterogeneous firms. Worker's compensated risk premia Zare distributed according to the uniform distribution Z; ~ U[1,6). The productivity cost of reducing the job risk for the firm MC; is distributed according to the uniform distribution MC; ~ U[2,6]." 1. What is the equilibrium market compensation and the share of risky jobs in this market? 2. Suppose that the government decides to subsidize the cost of reducing job risk, decreasing the cost by s = 2 for all firms. What is the new equilibrium market compensation for the job risk and the share of risky jobs in the economy? Provide the intuition for this change. Problem 4 Suppose the market for discrete job risk consists of multiple heterogeneous workers and multiple heterogeneous firms. Worker's compensated risk premia Zare distributed according to the uniform distribution Z; ~ U[1,6). The productivity cost of reducing the job risk for the firm MC; is distributed according to the uniform distribution MC; ~ U[2,6]." 1. What is the equilibrium market compensation and the share of risky jobs in this market? 2. Suppose that the government decides to subsidize the cost of reducing job risk, decreasing the cost by s = 2 for all firms. What is the new equilibrium market compensation for the job risk and the share of risky jobs in the economy? Provide the intuition for this change