Suppose That All Workers Value a 1% Reduction in the Workplace

Multiple Choice

Suppose that all workers value a 1% reduction in the workplace injury rate at $1,000.The cost of reducing the injury rate by 1% is $200 per worker.Firms currently pay $20,000 per year to workers,without any effort to improve safety.
Suppose new firms began to offer workers $19,500 and a 1% reduction in the injury rate.The total cost of hiring a worker to the existing firms is __________ and to the new firms it is __________.

A) $20,000;$19,500
B) $20,000;$18,500
C) $19,800;$19,500
D) $20,000;$19,700