Earnings usually reflect a person's productivity. What are factors that cause differences in productivity across people so that earnings differ too?
What will be an ideal response?
Productivity differences reflect differences in talent, training, experience, and human capital. People with more training or experience earn more, as do people with more human capital. Finally, some people just have a greater ability for certain things and this makes them more productive.
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As the use of DVDs becomes more widespread, we would expect all of the following except one. Which is the exception?
a. The prices of CDs will decrease. b. The demand curve for CD players will shift leftward. c. The supply curve of CD players will shift rightward. d. The demand curve for CDs will shift leftward. e. Firms will move their resources away from CD production to DVD production.
Suppose Annie expects an annual return of $520 from an investment worth $500 . What should be the rate of interest charged by her to a risky borrower who is likely to repay the principal and interest with a probability of 0.7?
a. 45 percent b. 48.6 percent c. 20.33 percent d. 53.4 percent