The positive correlation between ability and human capital investments "stretches out" wages in the population, generating what?
A)A positively skewed wage distribution.
B)A negatively skewed wage distribution.
C)An inconsistent wage distribution.
D)A uniform wage distribution.
E)A symmetric wage distribution.

Question

Quizplus · Accepted Answer

A positively skewed wage distribution is generated because individuals with higher ability and human capital investments are able to command higher wages, while those with lower ability and human capital investments earn lower wages. This results in a higher concentration of individuals earning lower wages and a smaller number of individuals earning higher wages, creating a positively skewed distribution.

The Positive Correlation Between Ability and Human Capital Investments "Stretches