The Efficiency Wage Hypothesis Holds That

question 12

Multiple Choice

The efficiency wage hypothesis holds that:

• A)there is payment of wage premiums by some employers to attract the best talent available and to enhance productivity in order to offset any increase in labor costs.
• B)unless an employee can produce a value equal to the value received in wages,it will not be worthwhile to hire that worker.
• C)there is increased willingness to reduce the size of the workforce,to outsource jobs overseas,and to restrict pay to control the costs of wages,salaries,and benefits.
• D)there is less concern with pay position relative to that of competitors and more concern with what the company can afforD.

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Definitions:

Irrational Escalation

The phenomenon where individuals continue or intensify an action or investment beyond a rational point, often due to emotional commitment or previous investments.

Commitment

The state of being dedicated to a course of action or to each other in the context of agreements or relationships.

Projection

A psychological defense mechanism where an individual attributes their own unacceptable feelings, thoughts, or motives onto another person.

Frames

Cognitive structures that shape how individuals perceive and interpret information, often influencing the manner in which problems, situations, or events are viewed.