Marginal Productivity Theory Implies That in a Perfectly Competitive Market

question 171

Multiple Choice

Marginal productivity theory implies that in a perfectly competitive market economy, a worker will receive income

• A) equal to the value of her marginal contribution to the production process.
• B) that is greater than the value of her marginal contribution to production process.
• C) that is less than the value of her marginal contribution to the production process.
• D) greater than, less than, or equal to the value of her marginal contribution to the production process, depending on her ability to negotiate with employers.

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Definitions:

Acting Locally

An approach focused on addressing issues and making positive changes within one's own community or region.

Compensation Systems

The methods and guidelines used by an organization to determine how employees are paid, including wages, salaries, bonuses, and benefits.

Decentralized Style

A management approach where decision-making is distributed among various levels within the organization, often empowering local or lower-level managers.

Participatory Style

A participatory style is a leadership approach that involves employees in decision-making processes and values their input in achieving organizational goals.