April is the CEO of a toy company that hires non-union labour. According to the theory of efficiency wages, if she decides to pay her workers more than the competitive equilibrium wage, what is most likely to happen?
A) The profits of her firm may increase.
B) The higher wages will induce her workers to shirk their responsibilities.
C) The turnover of her workers may increase.
D) She will face a shortage of quality workers.
Correct Answer:
Verified
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