The Term "Compensating Differential" Refers to

question 79

Multiple Choice

The term "compensating differential" refers to

• A) the fact that workers who do similar work should be paid the same wage.
• B) the fact that some workers live further from their jobs than do other workers.
• C) a wage difference that is distinguishable on the basis of monetary characteristics.
• D) a wage difference that arises from nonmonetary characteristics of different jobs.

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Definitions:

Initial Investment

The initial amount of money invested in a project or business venture.

CCA Rate

Refers to Capital Cost Allowance rate, which is the rate at which a business can claim tax depreciation on certain properties or equipment in Canada.

CCA Class

Canadian Capital Cost Allowance Class; a categorization in Canadian tax law that determines the depreciation rate for tax purposes on different types of assets.

Required Rate

The lowest expected gain an investor aims to receive from an investment in a specific asset, taking into account the associated risk.