{{ block title }}Income of Workers and Companies{{ endblock }} {{ block content }}
Worker Income

The manager will offer a wage between 60 and 100 Dimra. Each worker will receive one half of the wage offer. The worker will choose a work level between 1 and 10. Each work level has a cost. The costs associated with different work levels are given in the table below. The higher the work level, the higher the cost.

Work Level 1 2 3 4 5 6 7 8 9 10
Cost 2 4 6 8 10 12 14 16 18 20

The worker’s income is determined as:
Income of the worker = Wage - Cost of the work level chosen

Manager Income

The work levels chosen by the two workers in the group produce an output for the manager. That is,
Output = work level of the first worker + work level of the second worker

The manager’s income is determined as:
Income of the manager = 100 + 4*Output– Total wage for the two workers

Overall, other things being equal, a higher work level will lead to a higher cost (thus lower income) for the worker, and a higher output (thus higher income) for the manager.

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