The Answer Is: "It Is Sometimes in the Best Interest

question 68

Multiple Choice

The answer is: "It is sometimes in the best interest of business firms to pay their employees higher-than-equilibrium wage rates." What is the question?

• A) What do efficiency wage models imply?
• B) What do classical economists say?
• C) What is the central tenet of Say's law?
• D) What did John Maynard Keynes say was the reason for inflexible wages?
• E) none of the above

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Definitions:

Fairness

A person’s opinion as to whether a price, wage, or allocation is considered morally or ethically acceptable.

Maximize Profits

The process or strategy of adjusting production, pricing, and other operational variables to achieve the highest possible financial gain.

Time Inconsistency

The tendency of people to change their plans about future actions because of a change in their immediate preferences or circumstances.

Automatic Payroll Deductions

A system where amounts are automatically subtracted from an employee's paycheck by the employer for taxes, benefits, and other financial obligations.