In Order to Use Schooling as a Signal

question 11

Multiple Choice

In order to use schooling as a signal,

• A) the signal must be costlier for low-skilled workers than for high-skilled workers.
• B) the cost of purchasing the signal must not be so costly that high-skilled workers do not value obtaining it.
• C) firms must be able to easily verify each worker's amount of schooling.
• D) some people must choose to not complete schooling.
• E) All of these are required for schooling to serve as a signal.

---

Definitions:

Rule Of Reason

A doctrine used in U.S. antitrust law stating that not all restraints of trade are illegal, only those that are unreasonable, considering the facts surrounding the case.

Vertical Price-Fixing

An illegal practice where parties at different levels of the same supply chain (like manufacturers and retailers) agree to control the prices at which a product must be sold.

Per Se

A Latin phrase meaning "by itself" or "in itself," used to indicate something that is inherently or intrinsically the case.

Tying Agreements

Contracts where the buyer is required to purchase one product in order to buy another product, often considered anti-competitive.