Which of the Following Is Not a Potential Reason for Offering

question 40

Multiple Choice

Which of the following is not a potential reason for offering a wage above the market wage?

• A) A higher wage contributes to improved worker health.
• B) A higher wage makes the opportunity cost of losing a job higher, thus reducing "shirking."
• C) It reduces moral hazard.
• D) Higher wages attract more productive workers.
• E) Higher wages signal prestige and thus attract workers from elite schools.

---

Definitions:

Noncontrolling Interest

The portion of equity in a subsidiary held by investors other than the parent company, representing a minority stake that does not give its holders control over the company.

Intra-entity Purchases

Buying activities of goods or services conducted between departments or divisions within the same entity.

Equity Method

An accounting technique used to assess the profits earned by an investment in another company, recognizing such profits proportional to ownership share.

Intra-entity Purchases

Transactions involving the exchange of goods or services between entities within the same parent company, often leading to consolidation adjustments.