In order for the compensating differential associated with a risky job to be negative (so that a risky job pays less than a nonrisky job), it must be that
A. most workers prefer the risky job to the safe job when both wages are equal.
B. many workers are willing to work the risky job for free.
C. the government mandates that the wages in the two sectors be equal.
D. there is great demand for labor in both sectors.
E. the number of risky jobs is less than the number of workers who prefer the risky job.
Answer: E
You might also like to view...
The total producer surplus in the entire market is given by the:
A) product of the individual seller's surplus. B) sum of all the individual sellers' producer surplus. C) area between the market supply curve and the market demand curve. D) area between the market demand curve and the price line.
Cooperation in repeated prisoner's dilemma situations seems to be enhanced by all of the following except
a. limited punishment schemes b. clarity of conditional rewards c. grim trigger strategy d. provocability--i.e., credible threats of punishment e. tit for tat strategy
A problem associated with the principal-agent relationship is
A) imperfect information. B) perfect information. C) the low costs of monitoring behavior. D) none of these choices.
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, Point F
A. is efficient and attainable. B. cannot be produced with the current state of technology. C. represents underallocation of resources. D. represents what the people want.