Question: The Best and Worst Degrees by Salary Business administration is always a strong contender for honours as the most popular university major. This is no surprise since students think business is the way to make big bucks. But is business administration really as lucrative as students and their parents believe? Nope. In a new survey by Pay Scale, Inc. of salaries by degree, business administration didn't even break into the list of the top 10 or 20 most lucrative degrees. A variety of engineering majors claim eight of the top 10 salary spots with chemical engineering ($65,700) winning best for starting salaries. Out of 75 undergrad majors, business administration ($42,900) came in 35th, behind such degrees as occupational therapy ($61,300), information technology ($49,400), and economics ($48,800).
a. Why do university graduates with different majors have drastically different starting salaries?
b. Draw a graph of the labour markets for economics majors and business administration majors to illustrate your explanation of the differences in the starting salaries of these two groups.