Suppose that an employer hires workers with blue eyes and workers with brown eyes.Each type of worker has the same productivity.Which of the following is correct if the employer discriminates by offering blue-eyed workers lower wages than brown-eyed workers?
A)The employer will be just as efficient as a nondiscriminating employer.
B)The employer will face higher costs than firms that focus only on maximizing profits.
C)The employer will immediately go out of business because discrimination is illegal.
D)Both a and b are correct.

Question

Quizplus · Accepted Answer

Discriminating based on a characteristic such as eye color goes against the principles of equal opportunity and can lead to a less diverse workforce. By offering lower wages to one group, the employer may miss out on talented workers and may also face higher turnover and training costs. This can result in higher costs and lower profits compared to firms that do not discriminate and focus on maximizing profits. However, since the productivity and efficiency of all workers are assumed to be the same, option A is incorrect. Option C is also incorrect because discrimination based on eye color is not explicitly illegal in most countries.

Suppose That an Employer Hires Workers with Blue Eyes and Workers