James earns a degree from a top university and is hired by a prominent firm because executives at the firm believe that graduates of this university must have a high ability level or they would not have graduated. Which of the following theories of education do the executives believe?
A)signaling theory
B)human-capital theory
C)compensating-differentials theory
D)All of the above are correct.

Question

Quizplus · Accepted Answer

The executives' belief that graduates of the top university have a high ability level is in line with signaling theory, which posits that individuals use signals such as education to convey valuable information about their abilities to potential employers. The other two theories may also have some explanatory power, but the given information most closely aligns with signaling theory.

James Earns a Degree from a Top University and Is