Why do college-educated workers get paid more than those without a college education? Provide at least two reasons, using economic reasoning.
What will be an ideal response?
College may provide students with knowledge that makes them more productive than workers who have not been to college. Also, college may serve to sort students according to their dedication and willingness to work, since students who are not as dedicated and willing to work are not as likely to finish college. A college degree, then, would signal something positive to an employer about the person's work ethic.
You might also like to view...
The average propensity to consume is
A) real consumption expenditures divided by real saving. B) real saving divided by real consumption expenditures. C) real consumption expenditures divided by real disposable income. D) real disposable income divided by real consumption expenditures.
Refer to Table 4-4. If a minimum wage of $9.50 is mandated there will be a
A) shortage of 20,000 units of labor. B) surplus of 10,000 units of labor. C) shortage of 10,000 units of labor. D) surplus of 20,000 units of labor.
A comparative advantage is when a good can be produced at a(n) ________ cost in terms of other goods.
a. lower b. higher c. equal d. comparative
In the short run, if average variable costs equal $45, average total costs equal $50, and output equals 100, the total fixed costs will equal
a. $5. b. $500. c. $1,000. d. $5,000.