-In the Figure Above, the Demand and Supply of High-Skilled

question 12

Multiple Choice

-In the figure above, the demand and supply of high-skilled workers has an H subscript and the demand and supply of low-skilled workers as an L subscript. In the market for high-skilled labor, the equilibrium wage rate is

• A) $6.
• B) $4.
• C) $14.
• D) $10.

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Definitions:

Recency Bias

The tendency to weigh recent events more heavily than earlier events when making decisions.

Representativeness Heuristic

The representativeness heuristic is a mental shortcut people use to classify something based on how similar it is to a typical case.

Endowment Effect

A cognitive bias that causes individuals to value an owned object higher than it would be valued if it were not owned.

Frame Dependence

Refers to the phenomenon where an individual's decision-making is influenced by the way information is presented, rather than just the information itself.