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

Question

Quizplus · Accepted Answer

An income differential that induces increased rates of entry into the higher paid professions is not an example of an equilibrium factor-price differential, as it suggests a disequilibrium where the market is adjusting to equalize the supply and demand for labor in those professions.

All of the Following Are Examples of Equilibrium Factor-Price Differentials,EXCEPT