Which of the following is not an explanation for why better educated workers earn more, on average, than less educated workers?
a. The higher wages may be a compensating differential for the cost of acquiring the education.
b. Workers with a college degree signal their higher abilities to potential employers.
c. Skilled labor is increasingly becoming a substitute for unskilled labor, which raises the earnings of workers with more education.
d. Better educated workers are more productive, on average.
c
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All twelve Federal Reserve Bank presidents
A) attend Federal Open Market Committee Meetings. B) vote on decisions regarding the discount rate. C) vote on decisions regarding the prime rate. D) vote on decisions regarding bank reserve requirements.
The per person production function representing both physical capital per person (K/N) and human capital per person (H/N) is
A) Y/N = (K/N)b(H/N)c. B) Y/N = (K/N)b + (H/N)c. C) Y/N = (K/N)b - (H/N)c. D) Y/N = (K/N)b/(H/N)c.
Develop a simple model of inflation by identifying at least two exogenous variables and describing, briefly, how the value of these exogenous variables will impact the rate of increase in the overall level of prices in the economy
What will be an ideal response?
Because of the relationship between an asset's real rate of return and its risk, one would expect to find all of the following, except one. Which one?
A) Corporate stocks have higher rates of return than U.S. Treasury bonds. B) Corporate stocks have higher rates of return than U.S. Treasury bills. C) Corporate stocks have higher rates of return than corporate bonds. D) Stocks of smaller companies have higher expected rates of return than stocks of larger companies. E) Mutual funds including stocks of companies in politically volatile developing countries do not have as high a rate of return as mutual funds restricted to stocks of companies in developed economies.