Efficiency wages are usually set by employers to:
A) reduce unemployment.
B) increase employment.
C) provide an incentive for better performance.
D) increase employment and provide better incentives for performance.

Question

Quizplus · Accepted Answer

Efficiency wages are set by the employers to provide an incentive for better performance from employees. They pay higher wages than the market rate to motivate workers to deliver improved productivity, better quality, and innovation, which translate into higher profits and competitiveness for the company. Therefore, the correct option is C.

Efficiency Wages Are Usually Set by Employers To