Dan and Dave are both college graduates. Dan is a patrolman and Dave is a detective in the same police precinct. While Dan's job is inherently more dangerous than Dave's, Dave passed a difficult exam to gain promotion to detective. Dave earns more than Dan because
a. Dave's job is less dangerous.
b. of efficiency wages.
c. of education as a signal.
d. Dave has more human capital.
Ans: d. Dave has more human capital.
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Refer to Figure 28-2. Suppose the economy is at point A in the figure above. Which of the following is true?
A) Actual inflation is 1%. B) The economy will move from A to B. C) The expected rate of inflation is 5.5%. D) The current unemployment rate is 3.8%. E) The current unemployment rate is equal to the natural rate of unemployment.
Which of the following activities, if any, represents an external benefit? a. The benefit to a consumer from watching a film on DVD
b. The reduction in air quality resulting from industrial development in an urban area. c. The increase in the value of property belonging to your neighbors when you hire a landscaper to beautify your front yard. d. The reduction in property values when a new airport is built in a neighborhood.
The Social Security system is financed by
A. a payroll tax paid only by employers. B. a tax on individual retirement accounts. C. a tax on luxury goods. D. a payroll tax paid by both employers and employees.
If the exports are $1.5 trillion, imports are $2 trillion, short-term investment to and from the U.S. exactly balances, and taxes and private payments to and from the U.S. also exactly balance, the capital account balance is a
A. deficit of $3.5 trillion. B. surplus of $3.5 trillion. C. surplus of $.5 trillion. D. deficit of $.5 trillion.