The above figure shows the supply and demand curves for high-skilled and low-skilled labor. The figure shows that high-skilled workers earn a wage rate greater than low-skilled workers because
A) the supply of high-skilled labor is greater than the supply of low-skilled labor.
B) high-skilled labor has a lower value of marginal product.
C) of both the cost of acquiring skills and the differences in the value of marginal products.
D) of discrimination.
C
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Which of the following is an example of consumer surplus?
A) Jose buys a hamburger for $2 and tells you he would not have paid a penny more. B) John believes the price he paid for his computer was too high. C) Mary buys a paper tablet for $2 and finds the same good at another store for $1.50. D) Sue would have paid $15 for a new compact disc but paid only $10. E) Anne finds a mountain bike for which she is willing to pay a maximum of $550 and the price of the bike is $600.
Efficiency losses are
A) deadweight losses caused by consumers being prevented by tariffs from buying products at the world price, products that they value more highly than that price. B) the total loss in consumer surplus from a tariff. C) the increase in producer surplus that is created by a tariff. D) the deadweight loss that is created because domestic firms have to charge higher prices to produce units of output than foreign firms would have to charge.
The value of human capital can decrease when:
A. machines can be taught to do what people used to have to do. B. someone forgets how to do something that was valuable in his work. C. the skills someone possesses are no longer needed. D. All of these are examples of a decrease in human capital.
Suppose that when the price of hamburgers increases, the Ruiz family increases their purchases of hot dogs. To the Ruiz family
A) hamburgers and hot dogs are complements. B) hamburgers and hot dogs are inferior goods. C) hamburgers and hot dogs are normal goods. D) hamburgers and hot dogs are substitutes.