The Efficiency-Wage Theory of Worker Quality Suggests That If Firms

Multiple Choice

The efficiency-wage theory of worker quality suggests that if firms respond to a surplus of labor by reducing the wage, then highly qualified workers will be

A) more likely to apply, and unemployment will increase.
B) more likely to apply, and unemployment will decrease
C) less likely to apply, and unemployment will Increase.
D) less likely to apply, and unemployment will increase.