Which of the Following Sets of Circumstances Is Likely to Provide

question 45

Multiple Choice

Which of the following sets of circumstances is likely to provide the best evidence in support of the theory of efficiency wages?

• A)Workers in the market are unskilled and not represented by a union, and their wage exceeds the equilibrium wage.
• B)Workers in the market are highly skilled and not represented by a union, and their wage exceeds the equilibrium wage.
• C)Workers in the market are highly skilled and represented by a union, and their wage exceeds the equilibrium wage.
• D)Employers in the market are known for reducing the workers' wage whenever they get an opportunity to do so.

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Definitions:

Production Workers

Production workers are employees involved in the manufacturing process or operations of producing goods and services.

Wages

Compensation provided to workers for their work or services, commonly determined by the hour, day, or by the piece.

Wage Rates

The amount of money received per hour, day, or another unit of time for labor services.

Nominal Wages

Wages that are paid to employees not adjusted for inflation, representing the dollar amount received.