Rafael Is the Newly-Appointed Plant Manager for a Company That

Multiple Choice

Rafael is the newly-appointed plant manager for a company that manufactures head phones.Rafael's senior supervisors told him that the output the firm produces,given the number of workers employed,indicates that some workers may be shirking.According to efficiency wage theory,what should he do?

A) pay all workers more than the equilibrium wage rate
B) pay all workers below the equilibrium wage rate to make up for the loss from shirking
C) make sure that workers are getting paid exactly the equilibrium wage rate
D) fire the workers with the most seniority