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Priya Tarneja
on Nov 16, 2024

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Which of the following is an example of a compensating differential?

A) Paying workers with more years of experience higher wages than workers with fewer years of experience, all else equal
B) Paying workers who work on the day shift lower wages than workers who work the night shift, all else equal
C) Paying accountants who have passed the Certified Public Accountant exam higher wages than accountants who have not passed it, all else equal
D) Paying workers who have a higher educational attainment level higher wages than workers with less education, all else equal

Compensating Differential

A difference in wages that compensates workers for undesirable aspects of a job, such as hazardous working conditions or undesirable hours.

  • Recognize the role of compensating differentials in the labor market.
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Faiza EttangiNov 17, 2024
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