The fact that Tom Brady, the quarterback of the New England Patriots, is paid more than a high school football coach is an example of a wage disparity caused by compensating differentials.

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Compensating differentials refer to wage differences that arise to compensate workers for non-monetary aspects of different jobs, such as risk or undesirable conditions. The wage disparity between Tom Brady and a high school coach is more about differences in skill level, market demand, and revenue generation, not compensating differentials.

The Fact That Tom Brady, the Quarterback of the New