In the Efficiency Wage Model,if the Real Wage Is Higher

question 8

Multiple Choice

In the efficiency wage model,if the real wage is higher than the market-clearing wage so that there is an excess supply of labor

• A)firms will hire new workers at lower wages.
• B)firms will replace high-paid workers with low-paid, formerly unemployed workers.
• C)employers will not hire workers who are willing to work for a lower wage.
• D)firms will demand a higher level of effort from existing employees.

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