Eco 101
Homework Assignment 4
The due date for this assignment is Thursday March 10.
Instructions: Complete the following questions and turn in your solutions at the end of the class
lecture on the date due. Remember to include your name and student number on your submitted
document.
Question #1 – Definitions
i. Direct cost
ii. Indirect cost
iii. Inefficiency
iv. Investment in Human capital
v. Human Capital
vi. Minority
vii. Prejudice
viii. Discrimination
ix. Statistical discrimination
x. Occupational crowding
xi. Affirmative action
xii. Tokenism
Question #2 – Education and provision of Public Education
- Suppose the Inner City has a property tax base of $40,000 per student, while the Suburb has a
property tax based of $200,000 per student. Suppose the tax rate for education is 4%.
i. What is the amount of money available for educating students in the Inner City?
ii. What is the amount of money available for educating students in the Suburb?
iii. What is the difference in support for students in the Inner City as compared to
students in the Suburb?
iv. What tax rate would be required in the Inner City to make the funding per student the
same as in the Suburb?
v. What is likely to happen if the tax rate in the Inner city did rise to 20% (20% is the
answer you should have gotten in iv)?
