In competitive markets:
A) high-wage workers tend to be those that are most productive.
B) companies earn excess profits by better serving customer needs.
C) fairness is sacrificed in the interest of efficiency.
D) firms dictate the quantity and quality of goods and services provided.

Question

Quizplus · Accepted Answer

In competitive markets, high-wage workers tend to be those that are most productive. This is because in order to stay competitive, firms need to maximize their productivity by employing highly motivated and competent workers. As a result, high-wage workers tend to have the skills and knowledge that are most in demand by firms, and they are therefore compensated accordingly. This dynamic helps ensure that resources are allocated efficiently and that firms remain competitive.

In Competitive Markets