The Idea of Efficiency Wages Is That

question 10

Multiple Choice

The idea of efficiency wages is that

• A) the wages of each type of labor must be proportionate to their marginal products.
• B) the wages of each type of labor must be equal to their marginal products.
• C) firms might get greater work effort by paying above-equilibrium wage rates.
• D) workers are more diligent when paid below-equilibrium wages.

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Definitions:

Deindividuation

A psychological state where an individual loses self-awareness and personal accountability in groups, often leading to uncharacteristic behavior.

Zimbardo

Refers to Philip Zimbardo, a psychologist known for conducting the Stanford Prison Experiment, which explored the effects of perceived power and authority on behavior.

Input Variables

Factors or conditions that are manipulated or controlled in an experiment or study to observe their effect on the outcome.

Output Variables

Variables that measure the effects or results of a process, experiment, or intervention, often used to assess performance or effectiveness.