FIGURE 13- 4 The three diagrams below each show a supply curve for oil tankers over a relatively short period of time.

-All of the following are examples of equilibrium factor- price differentials,EXCEPT
A)higher pay to a dentist than to a dental hygienist.
B)the difference in average wages in Toronto and Dryden,Ontario.
C)the prices of two pieces of land,one with a good supply of water and one without.
D)the wages earned by labour of varying ability.
E)an income differential that induces increased rates of entry into the higher paid professions.

Question

FIGURE 13- 4 The three diagrams below each show a supply curve for oil tankers over a relatively short period of time.
 
-All of the following are examples of equilibrium factor- price differentials,EXCEPT
A)higher pay to a dentist than to a dental hygienist. 
B)the difference in average wages in Toronto and Dryden,Ontario. 
C)the prices of two pieces of land,one with a good supply of water and one without. 
D)the wages earned by labour of varying ability. 
E)an income differential that induces increased rates of entry into the higher paid professions.

Quizplus · Accepted Answer

The other options all refer to equilibrium factor-price differentials, where the price differences are due to some characteristic of the product or service being supplied. However, option E refers to an income differential that induces increased rates of entry into certain professions, which is not an equilibrium factor-price differential.

FIGURE 13- 4 the Three Diagrams Below Each Show a Supply