Briefly explain the four rationales for efficiency wages
1 . Better paid workers are healthier and therefore more productive. 2 . Firms reduce turnover costs by paying higher wages. 3 . Higher wages attract a better pool of job applicants. 4 . Higher wages deter shirking.
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The principle of voluntary exchange is based on the idea of
A) making assumptions. B) rational self-interest. C) thinking at the margin. D) isolating variables.
What are the three decisions that all firms must make?
What will be an ideal response?
An economic benefit of capital outflows is that they
A) create future income payment inflows. B) increase domestic investment. C) reduce domestic saving. D) reduce domestic unemployment.
In international trade the term "dumping" means
A) price discrimination by domestic producers. B) selling goods in a foreign market for a price less than on the home market. C) selling goods in a home market for a price less than on the foreign market. D) selling goods on the black market to avoid paying taxes.