The Demand for Alaskan Fishermen Is the Same as the Demand

question 130

Multiple Choice

The demand for Alaskan fishermen is the same as the demand for deep-sea divers in Hawaii. The annual earnings of Alaskan fishermen is 30% higher than the earnings of Hawaiian deep-sea divers. What is a possible explanation for this?

• A) Alaskan fishermen can work only part of the year, but deep-sea divers can work year round in Hawaii.
• B) The amount of human capital needed to be a deep-sea diver must be greater than the amount of human capital necessary to be a fisherman in Alaska.
• C) Alaskan fishermen must face discrimination that is not encountered by Hawaiian deep-sea divers.
• D) Being a fisherman in Alaska must be more dangerous than being a deep-sea diver in Hawaii.

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Definitions:

Present Values

The current worth of a future sum of money or stream of cash flows given a specified rate of return, taking into account the time value of money.

Future Value

The worth of a short-term asset at a certain future date, estimated based on a predicted rate of increase.

Interaction Effect

The outcome where the effect of one factor is differentiated across another factor.

Parallel

Entities or processes that are happening simultaneously without intersecting or affecting each other directly.