The same year that Derek Jeter, one-time shortstop for the New York Yankees, received an annual salary of $23.2 million, the president of the United States received an annual salary of $400,000. Based on marginal productivity theory and assuming these markets are competitive, this salary differential indicates that:
A. the president of the United States contributed much more to society than did Derek Jeter.
B. the salary differential between Derek Jeter and the president of the United States indicated that their marginal productivities cannot be compared.
C. Derek Jeter contributed much more to society than did the president of the United States.
D. Derek Jeter and the president of the United States made equal contributions to society.
Answer: C
You might also like to view...
Which of the following statements is true of world GDP before 1800?
A) The entire world population was living above the subsistence level of income. B) The GDP per capita in all nations was less than $500. C) Most of the countries were growing at a rate of more than 6% per year. D) Increase in GDP resulted in increase in consumption but not investment.
Which average cost curves are U-shaped?
What will be an ideal response?