Because the efficiency wage is _____ the equilibrium wage,it may lead to a _____ of labor.

A) below;shortage
B) below;surplus
C) above;shortage
D) above;surplus

Efficiency Wage

A theory stating that higher wages lead to greater efficiency and productivity by increasing worker morale, reducing turnover, and attracting more skilled employees.

Equilibrium Wage

The wage rate at which the supply of workers is equal to the demand for workers in the labor market.

Surplus

The amount of an asset or resource that exceeds the portion that is utilized.