The theory which holds that productivity of workers increases with the wage rate is the

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Quizplus · Accepted Answer

The theory which holds that productivity of workers increases with the wage rate is the efficiency wage theory. This theory suggests that employers can increase the productivity of their workers by paying them wages higher than the equilibrium wage for their skills and abilities. This can incentivize workers to work harder and more efficiently, as they feel valued and motivated. Therefore, the correct choice is D) efficiency wage theory.

The Theory Which Holds That Productivity of Workers Increases with the Wage