The answer is: "It is sometimes in the best interest of business firms to pay their employees higher-than-equilibrium wage rates." What is the question?
A) What do efficiency wage models imply?
B) What do classical economists say?
C) What is the central tenet of Say's law?
D) What did John Maynard Keynes say was the reason for inflexible wages?
E) none of the above

Question

Quizplus · Accepted Answer

Efficiency wage models suggest that it can be in the interest of firms to pay their employees higher wages than the market equilibrium to increase worker productivity and reduce turnover costs.

The Answer Is: "It Is Sometimes in the Best Interest