Efficiency Wages

question 309

Multiple Choice

Efficiency wages

• A)increase productivity and reduce unemployment.
• B)increase productivity but increase unemployment.
• C)decrease productivity but reduce unemployment.
• D)decrease productivity and increase unemployment.

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Definitions:

Marginal Tax Rate

The rate at which additional income is taxed, reflecting the proportion of each additional dollar of income that goes to taxes.

Weighted Average Cost of Capital

The average rate of return a company is expected to pay its security holders, weighted by the proportion of each security in the total capital structure.

Preferred Shares

Preferred shares are a type of stock that provides shareholders preferential payments of dividends and priority over common stock in asset liquidation, but generally do not carry voting rights.

Common Shares

Equities that represent ownership in a corporation, providing voting rights and a share in the company's profits through dividends.