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For a long time, your firm has been paying its workers a wage of $20 per hour, and your employees have been happy to work 40 hours per week at this wage. Business is suddenly booming, and your firm would really like your workers to agree to a 50-hour work week to meet this new demand for your product. You are considering two strategies. Under the first, you would raise the wage for all hours worked from $20 per hour to $22 per hour; under the second, you would leave the wage for the first 40 hours per week at $20 but offer $30 per hour for hours worked above 40 hours (that is, you would offer time-and-a-half for overtime). Both strategies have the same cost of $1,100 if a worker chooses to work 50 hours. Which strategy is more likely to lead your employees to agree to a 50-hour work week?
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