If, as some economists believe, changes in technology over recent decades have brought about changes in labor markets, then those changes likely have resulted in
a. reduced emphasis on compensating differentials as an explanation for wage differences.
b. a reduced emphasis on human-capital differences among workers as an explanation for wage differences.
c. a narrowing of the earnings gap between high-skilled workers and low-skilled workers.
d. a widening of the earnings gap between high-skilled workers and low-skilled workers.
d
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Policy is conducted via a rule if policymakers
a. use monetary and fiscal policy only when the political situation dictates it. b. set monetary and fiscal policy according to multiple but predetermined goals. c. a free to respond to unexpected changes in economic conditions. d. announce in advance how they will respond to changes in economic conditions.
The biggest difference between using a Pigovian tax or a tradable allowance to correct for a negative externality is:
A. the government collect revenues from the tax, and the private parties trade quota rights on their own. B. the tax creates an efficient outcome, and the tradable allowances do not. C. the tax maximizes total surplus, but the tradable allowances do not. D. All of these are differences between the two government policies.
The money rate of interest is the
a. real rate of interest minus the inflationary premium. b. real rate of interest plus the inflationary premium. c. real rate of interest divided by the inflationary premium. d. inflationary premium minus the real interest rate.
The expected stream of rental income is capitalized into value by converting expected future cash flows into present value through a process called:
A. amortization B. discounting C. compounding D. accounting