When Employers Sort Employment Applications into High-Ability and Low-Ability People

question 78

Multiple Choice

When employers sort employment applications into high-ability and low-ability people based on the attainment of a university degree (irrespective of major) ,they are providing evidence in support of which of the following

• A)the human-capital theory of education
• B)the signalling theory of education
• C)the principle that education enhances marginal productivity
• D)the neoclassical principle that most business owners are more interested in discriminating against a particular group than in maximizing profits

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Definitions:

Settlement Date

The date on which a trade or transaction must be finalized with the transfer of the asset and payment completed.

Risk Of Default

The possibility or likelihood that a borrower will not be able to meet debt obligations, leading to financial losses for the lender.

Futures Contracts

Financial contracts obligating the buyer to purchase an asset (like a commodity or financial instrument) and the seller to sell the asset at a predetermined future date and price.

Forward Contracts

Financial derivatives that obligate the buyer to purchase and the seller to sell a specific asset at a predetermined future date and price.