The Market-Clearing Wage Differential Between a Safe and a Risky

question 15

Multiple Choice

The market-clearing wage differential between a safe and a risky job is $5,000. Which of the following is not true?

• A)The marginal worker is indifferent between working the safe or the risky job.
• B)All but the marginal worker in safe jobs require a wage differential above $5,000 to accept a risky job.
• C)All but the marginal worker in the risky job require a wage differential below $5,000 to be indifferent between safe and risky jobs.
• D)The per-worker cost for any firm to change technologies to offer safe jobs in place of risky jobs is $5,000.
• E)The average per-worker cost of offering safe jobs exceeds $5,000 at the risky firms.

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