When a firm pays a wage that is higher than the market wage in order to increase worker productivity, the wage is called
A. a compensating differential.
B. a minimum wage.
C. an ideal wage.
D. an efficiency wage.
Answer: D. an efficiency wage.
When a firm pays a wage that is higher than the market wage in order to increase worker productivity, the wage is called
A. a compensating differential.
B. a minimum wage.
C. an ideal wage.
D. an efficiency wage.
Answer: D. an efficiency wage.