An Increase in Nonlabor Income Due to a Rise in the Value

question 31

Multiple Choice

An increase in nonlabor income due to a rise in the value of stocks and bonds will cause

• A) a pure income effect.
• B) a pure substitution effect.
• C) both an income and a substitution effect.
• D) neither an income nor a substitution effect.

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Definitions:

Individual Performance

Individual performance refers to the level at which an employee accomplishes their assigned duties and tasks, often evaluated in the context of their role within an organization.

Pay Plans

Systems or structures used by organizations to compensate employees, including wages, salaries, bonuses, and incentives.

Stock Plan Types

Various programs offered by companies to employees, allowing them to purchase company shares at favorable terms, such as Employee Stock Ownership Plans (ESOPs) or Stock Option Plans.

Suggestion Systems

Formal mechanisms within organizations where employees can propose ideas or improvements, often aimed at increasing efficiency or solving problems.