(I) Differences in worker productivity are one major reason why individual earnings differ.
(II) Even if all workers were identical, differences in the desirability of jobs would still cause earnings differentials.
a. I is true; II is false.
b. Both I and II are false.
c. Both I and II are true.
d. I is false; II is true.
c. Both I and II are true.
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One of the consequences of a rent ceiling set below the equilibrium rent is
A) decreased search activity. B) increased search activity. C) the establishment of landlord unions. D) surpluses of apartments. E) the elimination of the deadweight loss that would otherwise exist in the housing market.
Compared to setting a single price, if a firm can price discriminate it
A) makes a larger economic profit. B) makes a lower economic profit. C) makes zero economic profit. D) has no change in its economic profit from when it set a single price. E) might increase, decrease, or not change its economic profit depending on whether as a single-price monopoly its marginal revenue curve was above, below, or the same as its demand curve.
For complementary goods, an increase in the price of one results in a decrease in demand for the others
Indicate whether the statement is true or false
A firm that has merged with many other firms producing a variety of goods unrelated to each other
a. faces higher risks than if it specialized in one and focused on it b. increases its market share in the industry c. cannot maximize profit although it does maximize sales d. cannot survive in the long run e. is a conglomerate