Figure 21.2 shows the benefit functions for low-ability workers and high-ability workers (A and B), along with one indifference curve for each worker type (C and D). The employer cannot observe worker type directly but has created two positions, E and F, as a screening mechanism. Which of the following is true?
A. Curve A is an indifference curve for a low-ability worker, and curve B is an indifference curve for a high-ability worker.
B. Curve A is the benefit curve for high-ability workers, and curve B is an indifference curve for a high ability worker.
C. Curve A is an indifference curve for a high-ability worker, and curve C is the benefit curve for high-ability workers.
D. Curve A is the benefit curve for high-ability workers, and curve C is an indifference curve for a high ability worker.
D. Curve A is the benefit curve for high-ability workers, and curve C is an indifference curve for a high ability worker.
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