Paul and David work for the same company and have the same job title, education, work experience, and are equally skilled at what they do. Paul works the night shift and is paid $60,000 a year, while David works a regular day shift and is paid $55,000 a year. Which of the following is the best explanation for why Paul earns more than David? a Paul has more human capital than David. b David has more human capital than Paul. c Paul has received a compensating differential. d Aside from pay, the night shift is more desirable than the day shift.
a. Paul has more human capital than David.
b. David has more human capital than Paul.
c. Paul has received a compensating differential.
d. Aside from pay, the night shift is more desirable than the day shift.
Ans: c. Paul has received a compensating differential.
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A. a higher rate of population growth. B. an open economy. C. an educated population. D. a system of property rights.