If the Cost of Monitoring Worker Effort Is High, Then

question 27

Multiple Choice

If the cost of monitoring worker effort is high, then a firm can encourage workers to work hard by paying an efficiency wage because

• A) Paying an efficiency wage means a firm can monitor its workers more cheaply.
• B) The efficiency wage will encourage workers to monitor each other's effort and report shirking to the employer.
• C) Efficiency wages guarantee efficiency.
• D) The efficiency wage will raise the cost to workers of losing their jobs, even though there may be a low risk of being dismissed for shirking.

---

Definitions:

Adolescent Girls

Female individuals who are in the stage of development between childhood and adulthood, typically between the ages of 10 and 19.

Identity Moratorium

A stage in Erik Erikson’s theory of psychosocial development where individuals are exploring various commitments and are yet to make clear choices about aspects of their identity.

Explored

Investigated or examined for the purpose of discovery and learning more about a subject.

Future

The time or period that is to come which has not occurred yet.