The Theory of "Efficiency Wages" Suggests That a Pool of Involuntarily

Multiple Choice

The theory of "efficiency wages" suggests that a pool of involuntarily unemployed workers

A) quickly disappears because perfectly-flexible wages eliminates this inefficient waste of resources.
B) exists only between sessions of wage re-negotiation.
C) is comprised solely of workers who have failed to meet the productivity standards of potential employers.
D) is irrelevant to the behaviour of employed workers.
E) provides an incentive for employees to work hard so they are not laid off.