Suppose a Theory Predicts That Lowering Tuition Fees at Canadian

question 141

Multiple Choice

Suppose a theory predicts that lowering tuition fees at Canadian universities will increase enrollment from low-income households.If empirical evidence is inconsistent with this prediction,then we

• A)need to amend the theory.
• B)should test the theory again.
• C)should change the empirical data.
• D)should increase tuition fees back to their initial level.
• E)change the exogenous variables in the theory.

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Definitions:

Compensating Differentials

The variation in wage rates paid to different workers, mainly due to the non-monetary advantages or disadvantages of specific jobs.

Talent

A natural aptitude or skill possessed by individuals.

Human Capital

Represents the economic value of a worker's experience and skills, including education, training, intelligence, skills, health, and other things employers value such as loyalty and punctuality.

Differences in Talent

Variations in the natural abilities, skills, or competencies among individuals that can impact productivity and earnings.