The Wage Differential Between High-Skilled and Low-Skilled Workers Is the Result

question 103

Multiple Choice

The wage differential between high-skilled and low-skilled workers is the result of

• A) a difference in the value of marginal product.
• B) the cost of acquiring skills.
• C) a negative income tax.
• D) Both answers A and B are correct.
• E) Both answers B and C are correct.

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Definitions:

Factoring

A financial transaction where a business sells its accounts receivable to a third party at a discount to secure immediate capital.

Assignment

Assignment refers to the transfer of rights or property from one party to another, commonly seen in contracts and legal agreements.

Novation

The act of replacing one obligation with another by mutual agreement, effectively creating a new contract.