Ben and Ashley Are Identical in Every Way Except for One

question 94

Multiple Choice

Ben and Ashley are identical in every way except for one: Ashley has an IQ score 10 points higher than Ben.All else equal,human capital theory would predict Ashley

• A)and Ben will earn the same.
• B)will earn exactly 10% more than Ben.
• C)will earn less than Ben.
• D)will earn more than Ben.

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Definitions:

Equilibrium Price

The cost at which the amount of a product or service sought by consumers matches the amount available from suppliers.

Equilibrium Quantity

At the market equilibrium price, the amount of goods or services provided matches the amount that is demanded.

Substitutes

Goods or services that can replace each other in usage, such that an increase in the price of one leads to an increase in demand for the other.

Equilibrium Quantity

The quantity of goods or services supplied and demanded at the equilibrium price in a market.