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Answer to Question #72430 in Other Economics for darragh

Question #72430
groupK : smart
groupM : not as smart

Cost of attaining education:
CK(e) : 3000e
CM(e) : 4000e e stands for years of education

employees are offered 30,000 if e<e*
employees are offered 90,0000 if e>e*

Question; for education to serve as a signal for smarts what is the min e* employers should set?
Expert's answer
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