In a market system, a ﬁrm's employees are typically shielded from business risk by
A) proﬁt-sharing agreements.
B) wage contracts.
C) the Social Security program.
D) paid vacation leaves.

Question

Quizplus · Accepted Answer

In a market system, firms typically offer wage contracts to their employees, which provide a fixed salary regardless of how well the business is doing. This means that the employees are shielded from the risks and uncertainties of the market, as their income is not directly tied to the performance of the business.

In a Market System, a ﬁRm's Employees Are Typically Shielded