The Theory of Efficiency Wages Suggests That

question 415

Multiple Choice

The theory of efficiency wages suggests that

• A)above-equilibrium wages increase worker productivity.
• B)workers with higher levels of education earn more than workers with lower levels of education.
• C)workers signal their high ability to potential employers by completing formal years of schooling.
• D)union workers earn more than nonunion workers.

---

Definitions:

Unadjusted Trial Balance

A listing of all the accounts and their balances from a company's general ledger before any adjusting entries are made for accounting purposes.

Cash Account

A cash account is a brokerage account that requires the investor to pay the full amount for securities purchased and to receive full delivery of the securities sold.

Two-Column Journal

A fundamental accounting record with two columns used for debits and credits to record financial transactions.

Debit

An accounting entry that increases an asset or expense account, or decreases a liability or equity account. It is positioned on the left side of an account ledger.