Which term refers to a wage rate above what is necessary to attract a sufficient number of workers?
A) market-clearing wage
B) efficiency wage
C) marginal productivity wage
D) minimum wage

Question

Which term refers to a wage rate above what is necessary to attract a sufficient number of workers?  
A) market-clearing wage 
B) efficiency wage 
C) marginal productivity wage 
D) minimum wage

Quizplus · Accepted Answer

An efficiency wage is a wage rate above what is necessary to attract a sufficient number of workers. This type of wage is paid by employers to motivate and retain workers, increase productivity, reduce worker turnover and absenteeism, and enhance the overall quality of the workforce. Market-clearing wage is the wage rate at which the supply of labor equals the demand for labor, marginal productivity wage is a wage that is based on the worker's marginal product or contribution to output, and minimum wage is the legally mandated lowest wage rate that employers can pay their employees.

Which Term Refers to a Wage Rate Above What Is