In a population, not all workers have a high school diploma. Suppose the size of the labor force
increases but a smaller percentage of the labor force has a high school diploma. It is reasonable to
expect that the larger labor force will ________ the human capital input and the smaller percentage of
the labor force with a high school diploma will ________ the human capital input.
A) decrease; increase
B) decrease; decrease
C) increase; decrease
D) increase; have no effect on
E) increase; increase

Question

Quizplus · Accepted Answer

The larger labor force increases the human capital input due to more workers, but the smaller percentage with a high school diploma decreases the average skill level, thus decreasing the human capital input.

In a Population, Not All Workers Have a High School