How might technological change and globalization explain trends in the distribution of income?
What will be an ideal response?
Technological change and globalization have both changed the distribution of income so that the "rich get richer and the poor get poorer." More specifically, technological change has increased the demand for high-skilled workers and increased their wage rates and incomes. It also has decreased the demand for low-skilled workers and decreased their wage rates and their income. Globalization also has increased the demand for high-skilled workers and decreased the demand for low-skilled workers in the United States. Globalization has made contests worldwide, so the prizes for the best superstars—be they athletes or business managers—have increased with the increase in the size of the market.
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The table above gives production information for Bob's Baseball Cap Company. Bob's total cost when zero caps are produced is $200 and workers cost $10 per hour. The total cost of producing 30 baseball hats per hour is
A) $50. B) $200. C) $250. D) More information is needed to answer the question.
Over long periods of time, the growth rates of actual and potential GDP have been
A. diverging. B. similar. C. declining together. D. usually far apart.