Homework Assignment 9 (2 points) Why do people get paid differing wages? What co
ID: 1156215 • Letter: H
Question
Homework Assignment 9 (2 points) Why do people get paid differing wages? What compensating differentials may occur? Give examples. 1. (2 points) How do unions change the labor market? Give the pros and cons of unions. Do you think they are necessary? Why or why not? Remember to consider unions in conjunction with large employers who dominate the labor market. 2. (4 points) Watch the following videos: Wealth inequality in motion and How inequality hurts countries. What causes wealth and income inequality? Do you think it is a problem in our current economy? What, if anything should be done about inequality? 3. (2 points) When would a firm pay higher than equilibrium wages? What is the economic term associated with this? What might cause a firm to make this decision? 4.Explanation / Answer
1. People are getting paid difering wages based on their qualifications, skills and expertise. There are various reasons for people being paid differing wages :
Compensating diferentials may occur based on :
As a result the income inequality arises amongst the population which leds to dissatisfaction arising amongst the individuals. For example, there is very high income inequality amongst the population in India. rich people are becoming richer and poor people becoming poorer day by day.
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