Which of the following is an example of an efficiency wage?

A) A higher wage paid to a more experienced worker
B) A below-equilibrium wage paid by a small business exempt from minimum-wage laws
C) An above-equilibrium wage paid by a firm to reduce turnover costs
D) A wage tied to participation in a government-sponsored job training program

Efficiency Wage

A higher-than-market wage paid by employers to increase worker productivity and loyalty.

Above-Equilibrium Wage

Wages that are set above the market equilibrium, often leading to excess supply of labor and potential unemployment.

Turnover Costs

Expenses associated with replacing personnel, including recruiting, hiring, and training new employees.