Figure 19-5
-Refer to Figure 19-5. Given demand for labor, D1, and supply of labor, S2, which of the following could be considered an efficiency wage?
A)$4
B)$5
C)$6
D)$7

Question

Figure 19-5 
-Refer to Figure 19-5. Given demand for labor, D1, and supply of labor, S2, which of the following could be considered an efficiency wage?
A)$4 
B)$5 
C)$6 
D)$7

Quizplus · Accepted Answer

An efficiency wage is a wage higher than the equilibrium wage to increase worker productivity. In this case, $7 is above the equilibrium wage where D1 and S2 intersect.

Figure 19-5 -Refer to Figure 19-5. Given Demand for Labor, D1, and Labor