Which of the Following Is a Plausible Explanation for a Firm

question 175

Multiple Choice

Which of the following is a plausible explanation for a firm paying above-equilibrium wages to its workers?

• A)It increases the probability that a worker who shirks will be caught.
• B)It discourages workers from shirking out of fear of losing their high-paying job.
• C)The Condorcet Paradox suggests that paying high wages will result in greater effort by employees.
• D)By paying a high wage, employers solve the adverse selection problem and motivate the employees to work harder.

---

Definitions:

Processing Speed

The pace at which an individual can comprehend and respond to information.

Memory Decline

The gradual reduction in the capacity to recall or retain memories, often associated with aging or disease.

Expertise

An elaborate and integrated knowledge base that underlies extraordinary proficiency in a given area.

Biological Waste

Material derived from living organisms, such as medical waste or laboratory samples, which can be hazardous and requires specific disposal methods to prevent contamination.