Adam and Bob Are Identical Twins Who Attended Grammar School

question 145

Multiple Choice

Adam and Bob are identical twins who attended grammar school through high school together. Adam got a job after high school, and Bob got a job after graduating from college. Adam earns $36,000 a year, and Bob earns $69,000 a year. Select the best explanation for this wage difference.

• A)Adam has less human capital than Bob.
• B)Bob has less human capital than Adam.
• C)Adam has received a compensating differential
• D)Adam is a member of a union.

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Definitions:

Functional Currency

The primary currency of the primary economic environment in which an entity operates and carries out its financial transactions.

Conditions

Circumstances or factors that affect the performance and outcomes of a business or agreement.

U.S. Dollar

The official currency of the United States of America, widely used as a benchmark and reserve currency globally.

Income Statement

A financial statement that shows a company’s revenue and expenses over a specific period, leading to the net income or loss for that period.