On average, truck drivers who drive on dangerous ice-covered roads earn more per mile driven than similarly skilled truck drivers who drive on normal roads. The difference in pay can be attributed to
a. the marginal product of labor.
b. the marginal product of capital.
c. diminishing marginal returns.
d. a compensating differential.
d
You might also like to view...
Education in the United States is
A) subsidized mainly by state and local governments. B) funded by the federal government only. C) paid for by the parents of students in public school system. D) paid for by Social Security taxes.
If the favorable supply shocks of the 1990s were reversed in the future, we should expect a(n)
a. increase in inflation and unemployment. b. decrease in inflation and unemployment. c. increase in inflation and a decrease in unemployment. d. decrease in inflation and an increase in unemployment.
The classical dichotomy refers to the separation of
a. prices and nominal interest rates. b. taxes and government spending. c. decisions made by the public and decisions made by the government. d. real and nominal variables.
Suppose an American worker can make 50 pairs of gloves or grow 300 radishes per day. On the other hand, a Bangladeshi worker can produce 100 pairs of gloves or grow 200 radishes per day. Using the concepts of advantage and trade, we can say that the opportunity cost of one pair of gloves is:
A. lower for the United States than Bangladesh, therefore the United States has a comparative advantage in glove production. B. the same for both the United States and Bangladesh, therefore they both have the comparative advantage in glove production. C. the same for both the United States and Bangladesh, therefore no comparative advantage exists. D. higher for the United States than Bangladesh, therefore the United States has a comparative advantage in radish production.