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Author Question: If the MPC is 0.5, then a 10 million increase in disposable income will increase consumption by ... (Read 88 times)

ETearle

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on: Jun 29, 2018
If the MPC is 0.5, then a 10 million increase in disposable income will increase consumption by
 
  A) 15 million B) 5 million. C) 50 million. D) 2 million.

Question 2

Why would a firm pay efficiency wages?
 
  What will be an ideal response?


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Zack0mack0101@yahoo.com

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Reply #1 on: Jun 29, 2018
Answer to Question 1

B

Answer to Question 2

An efficiency wage is a wage that is higher than the market wage. Firms pay efficiency wages to raise productivity. Studies show that workers are motivated to work harder if they are paid higher wages. Put differently, a firm does not monitor workers as closely in order to get them to be more productive. The higher wage motivates them to be productive.


ETearle

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Reply 2 on: Jun 29, 2018
Gracias!

amit

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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