Wage Differentials Quiz

What is a wage differential?

• Difference in tax rates between regions

• A bonus added to salary

• Difference in wages across jobs, locations, or people

• The minimum wage set by government

Which of the following is a cause of wage differentials between occupations?

• Level of skill and training

• Labour union agreements only

• Currency exchange rates

• Interest rate policies

Which job is most likely to have a high wage due to unpleasant working conditions?

• Librarian

• Accountant

• Deep-sea diver

• Teacher

Which factor can explain different wages for the same occupation across locations?

• Identical cost of living

• Geographic location and living costs

• Equal productivity everywhere

• Fixed minimum wage globally

Why might a software developer in the U.S. earn more than one in Indonesia?

• Higher labour productivity and living costs

• Lower taxes

• Stronger unions

• Better weather

Which of the following is NOT a typical cause of wage differentials?

• Skills and education

• Price of crude oil

• Labour market power

• Working conditions

Which group is most likely to face wage discrimination?

• Workers with PhDs

• Migrant workers

• High-income CEOs

• Bondholders

Why do workers in large firms often earn more?

• They work longer hours

• Large firms are unionized

• Large firms have more resources and benefits

• The law requires higher wages

What economic factor explains wage differences between doctors and cleaners?

• Market share

• Differences in skill and productivity

• Loan interest rates

• Subsidy levels

Which is a non-economic factor causing wage differentials?

• Gender discrimination

• Capital investment

• Foreign exchange

• Technological innovation