Suppose that the salary range for recent college graduates with a bachelor's degree in economics is $30,000 to $50,000, with 25 percent of jobs offering $30,000 per year, 50 percent offering $40,000 per year and 25 percent offering $50,000 per year and that in all other respects, the jobs are equally satisfying. Assume that in this market, a job offer remains open for only a short time so that continuing to search requires an applicant to reject any current job offer. If this scenario describes job searches in general, the segment of the population that is most risk-averse will tend to earn:
A)average salaries.
B)below-average salaries.
C)above-average salaries.
D)stable salaries.

Question

Quizplus · Accepted Answer

At least some risk-averse people will stop searching for a higher-paying job before they've found one that pays even the expected value.

Suppose That the Salary Range for Recent College Graduates with a Bachelor's