Women earn less on average than men. Which of the following would be the logical conclusion?
a. Women must be the victim of employment discrimination.
b. Women must be less productive.
c. Men must be more highly motivated and materialistic.
d. Without consideration of preferences and productivity factors, differences in unadjusted mean earnings do not necessarily reflect employment discrimination.
D
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According to the liquidity premium theory, if market participants expect that inflation in the future will be lower than it currently is, the yield curve will
A) slope upward. B) be flat. C) be inverted. D) be vertical.
The proliferation of the horse in the 17th century caused Great Plains Indians to:
a. increase their reliance on agricultural work. b. engage in less tribal warfare. c. use smaller and more independent hunting groups. d. kill fewer bison, but make more intensive use of the meat on the carcass.
Which of the following statements regarding black markets is true?
a. The reliability of products sold in black markets is generally higher than the reliability of products sold in legal markets. b. The prices of goods in black markets are generally lower than the prices of similar products in legal markets. c. The laws of supply and demand do not affect the prices of goods exchanged in black markets. d. The rate of violence is higher in black markets than in legal markets.
Suppose Erie Textiles can dispose of its waste "for free" by dumping it into a nearby river. While the firm benefits from dumping waste into the river, the waste reduces fish and bird reproduction. This causes damage to local fishermen and bird watchers. At a cost, Erie Textiles can filter out the toxins, in which case local fishermen and bird watchers will not suffer any damage. The relevant gains and losses (in thousands of dollars) for the three parties are listed below. WithFilterWithoutFilterGains to Erie$200$400Fisherman$180$50Bird Watchers$130$25Suppose you observe that Erie has not added a filter. You could conclude that the Coase theorem failed to solve the externality problem because:
A. regulators prevent application of the Coase theorem when the environment is at stake. B. negotiation with many individual fishermen and bird watchers was too costly. C. Erie's benefits to operating without a filter are greater than the benefits of a filter to the fishermen and bird watchers. D. Erie has a property right to the river.