The Efficiency-Wage Theory of Worker Quality Suggests That If Firms

question 148

Multiple Choice

The efficiency-wage theory of worker quality suggests that if firms respond to a surplus of labor by reducing the wage, then highly qualified workers will be

• A)more likely to apply, and unemployment will increase.
• B)more likely to apply, and unemployment will decrease
• C)less likely to apply, and unemployment will Increase.
• D)less likely to apply, and unemployment will increase.

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Definitions:

Ratio

A comparative statistic that shows the relative size of two numbers or quantities to each other, expressed as "x to y" or x:y.

Ratio

A mathematical relationship between two numbers indicating how many times the first number contains the second.

Interval

A range of values between two points, often used in reference to scales in measurements.

True Zero Point

In measurement scales, a true zero point indicates the absence of the quantity being measured, allowing for ratios to be meaningfully calculated.