Assume That Empirical Evidence Shows a Difference in Mean Earnings

question 109

Multiple Choice

Assume that empirical evidence shows a difference in mean earnings between two groups, say, majority and minority workers. What conclusion may be drawn?

• A) The group with the lower earnings is being discriminated against.
• B) The group with the lower earnings is less productive.
• C) The group with the higher earnings has a larger quantity of human capital.
• D) Any of the above statements could, either partially or entirely, explain the difference in the mean earnings.

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Definitions:

Par-value Share

A type of share that has a face value or nominal value assigned to it, which is the minimum price at which the shares can be issued.

Secured

A status indicating that a loan or credit has collateral attached to it, ensuring the lender's investment is protected.

Separate Legal Entity

The principle that a corporation exists separately from the people who created it.

Unanimous Shareholders' Agreement

An agreement among all shareholders of a corporation, often detailing the management, control, and direction of the corporation's affairs.