When Comparing the Salaries of a Superstar CPA and a Superstar

question 383

Multiple Choice

When comparing the salaries of a superstar CPA and a superstar golfer,

• A)both can earn tremendously high salaries because both can meet with millions of clients.
• B)the superstar CPA will not earn as much as the superstar golfer because superstar accountants do not have access to the same sophisticated technologies that superstar golfers do.
• C)the superstar CPA will not earn as much as the superstar golfer because a superstar accountant can only work with a limited number of clients per day, whereas millions of fans can enjoy the services provided by a superstar golfer on a given day by watching a televised tournament.
• D)the superstar CPA will not earn as much as the superstar golfer because customers are unable to distinguish superstar accountant from a mediocre accountant.

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Definitions:

Earnings Differential

The difference in wages or salaries stemming from differences in job difficulty, location, skills required, or other factors.

Wage Differentials

The variation in wage rates paid to different groups of workers, often based on skill, location, industry, or job function.

Human Capital

The stock of knowledge, habits, social and personality attributes, including creativity, embodied in the ability to perform labor so as to produce economic value.

Personal Prejudice

An unfounded or irrational bias towards individuals or groups based on characteristics such as race, gender, religion, or sexual orientation.