Michael decides to hire some additional workers for his roofing company. The equilibrium wage is $17 per hour. Efficiency wage theory suggests that it is reasonable for Michael to offer
a. $17 per hour.
b. less than $17 per hour because some people would be willing to work for less.
c. less than $17 an hour to prevent shirking.
d. more than $17 per hour in order to attract a better pool of applicants.
d
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Deciding how to make the best use of limited resources to satisfy virtually unlimited wants is known in economics as
a. economizing behavior. b. the fallacy of composition. c. ceteris paribus. d. the fallacy that good intentions do not guarantee the desired outcome.
Economist B thinks that it is important to identify the condition(s) under which the case for government is strongest. With respect to the provision of nonexcludable public goods, she says
A) people must pay taxes to pay for the nonexcludable public good. B) firms must pay taxes to pay for the nonexcludable public good. C) people must actually want the nonexcludable public good that the government provides. D) people must express their desire for the nonexcludable public good by voting for it. E) none of the above