The starting salary for a garbage hauler is about $60,000 more than a teacher.Which of the following terms explains this difference?
A) Pareto optimal
B) payroll tax
C) reservation value
D) compensating wage differential
E) competitive Equilibrium

Question

Quizplus · Accepted Answer

A compensating wage differential refers to the difference in salary between two jobs that have different levels of undesirable aspects, such as physical strain, danger, or unpleasant working conditions. In this case, being a garbage hauler may be viewed as less desirable than being a teacher, leading to a higher starting salary to compensate for the less desirable aspects of the job.

The Starting Salary for a Garbage Hauler Is About $60,000