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Juan Works at Texas Burgers in El Paso and Earns

Question 95

Multiple Choice

Juan works at Texas Burgers in El Paso and earns $8.00 per hour. His twin brother Felipe works in Mexico Burgers in Ciudad Juarez just across the border and earns $3.00 per hour for exactly the same work. An economist looking at this situation sees:


A) an incentive for Felipe to cross the border to get a job and thus reduce the gap.
B) an incentive for Felipe to quit and find another job in Mexico.
C) the tendency of the rich to get richer and the poor to get poorer, widening the gap.
D) evidence that the law of one price has no support in the real world.

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