Question

A worker in Vietnam can earn $6 per day making cotton cloth on a hand loom. A worker in the United States can earn $85 per day making cotton cloth with a mechanical loom. What is the likely explanation for the difference in wages?

Answer 1

Answer:

c. Labor is more productive making cotton cloth with a mechanical loom than with a hand loom.

Explanation:

Here are the options to this question :

. U.S. textile workers belong to a union, whereas Vietnamese textile workers do not belong to a union.

b. There is little demand for cotton cloth in Vietnam and great demand in the U.S.

c. Labor is more productive making cotton cloth with a mechanical loom than with a hand loom.

d. Vietnam has a low-wage policy to make its textile industry more competitive in world markets.

The mechanical loom would produce more cotton cloth than a hand loom. So, due to higher productivity of the mechanical loom,  the worker who uses a mechanical loom would be paid higher than a worker using a hand loom