Wages reflect productivity differences Steps:

• Identify that average earnings refer to wages or income levels across countries.
• Recall that wages are determined by labor market factors, primarily productivity.
• Evaluate each option's impact on average earnings.
• Select the option linking to a fundamental economic principle.

Why C is correct:

• In economics, wages tend to equal the marginal product of labor; higher productivity in Switzerland means workers produce more value, justifying higher pay.

Why the others are wrong:

• A: More part-time work would lower average full-time equivalent earnings, not raise them.
• B: Higher taxes reduce take-home pay but do not cause gross earnings to be higher; they follow from earnings.
• D: Higher unemployment typically pressures wages downward, not upward.

Final answer: C