If the underground economy is larger in Europe than in the United States, then the difference in the _____ number of hours worked between Europe and the United States may be smaller than the difference in the _____ numbers of hours worked.

Question

Quizplus · Accepted Answer

The underground economy refers to economic activities that are not reported to the government, so they are not measured. Therefore, if the underground economy is larger in Europe, the measured number of hours worked in Europe may be lower than the actual number of hours worked, while in the United States, the difference between the measured and actual numbers of hours worked may be smaller. Thus, the difference in actual (unmeasured) numbers of hours worked may be smaller than the difference in measured numbers of hours worked.

If the Underground Economy Is Larger in Europe Than in the United