The extra wage that is paid to an individual to attract her to a less desirable job is called:
A) the benchmark competitive wage.
B) the general training human capital difference.
C) the specific training human capital difference.
D) a compensating differential.

Question

Quizplus · Accepted Answer

A compensating differential is the extra wage paid to workers for taking on a job that is less desirable due to factors such as unpleasant working conditions, dangerous environment or long working hours. This extra wage is intended to compensate for the inconvenience and discomfort that come with such jobs. Therefore, choice D, a compensating differential, is the best answer.

The Extra Wage That Is Paid to an Individual to Attract