A Firm Uses an Efficiency Wage Scheme to Deter Workers

question 16

Multiple Choice

A firm uses an efficiency wage scheme to deter workers from shirking,which is detected 10% of the times.Suppose a risk-neutral worker that has a reservation wage of $500.The industry ongoing wage is $1000.What is the efficiency wage paid by this firm?

• A) $6,000
• B) $5,000
• C) $1,500
• D) $2,000

---

Definitions:

Business Goals

Objectives that a company aims to achieve over a specific period of time.

Compliance

Adhering to laws, regulations, standards, and ethical practices that are relevant to an organization’s operations and industry.

Vulnerabilities

Weaknesses or gaps in a security system that can be exploited by threats to gain unauthorized access to an asset.

Bank Reconciliation

The process of comparing and matching figures from the accounting records against those shown on a bank statement.