The reason for the badness of performance compensation caps.

Question

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Answer 1

Question

Chapter 1, Problem 1MC

To determine

The reason for the badness of performance compensation caps.

Expert Solution & Answer

Explanation of Solution

The compensation cap refers to the maximum limit on the salary paid. The compensation cap encourages the employees to be productive up to this limit; but it makes the employees less productive beyond the limit or cap value. This is because the employees will not receive any benefit after this limit. Therefore, the compensation cap will affect badly on the productivity of the economy. Thus, option ‘b’ is correct.

Economics Concept Introduction

Compensation cap: Compensation cap refers to the maximum limit on the salary paid to the employees.

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Answer 2

Question

Chapter 1, Problem 1MC

To determine

The reason for the badness of performance compensation caps.

Expert Solution & Answer

Explanation of Solution

The compensation cap refers to the maximum limit on the salary paid. The compensation cap encourages the employees to be productive up to this limit; but it makes the employees less productive beyond the limit or cap value. This is because the employees will not receive any benefit after this limit. Therefore, the compensation cap will affect badly on the productivity of the economy. Thus, option ‘b’ is correct.

Economics Concept Introduction

Compensation cap: Compensation cap refers to the maximum limit on the salary paid to the employees.

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Answer 3

Question

Chapter 1, Problem 1MC

To determine

The reason for the badness of performance compensation caps.

Expert Solution & Answer

Explanation of Solution

The compensation cap refers to the maximum limit on the salary paid. The compensation cap encourages the employees to be productive up to this limit; but it makes the employees less productive beyond the limit or cap value. This is because the employees will not receive any benefit after this limit. Therefore, the compensation cap will affect badly on the productivity of the economy. Thus, option ‘b’ is correct.

Economics Concept Introduction

Compensation cap: Compensation cap refers to the maximum limit on the salary paid to the employees.

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Answer 4

Question

Chapter 1, Problem 1MC

To determine

The reason for the badness of performance compensation caps.

Expert Solution & Answer

Explanation of Solution

The compensation cap refers to the maximum limit on the salary paid. The compensation cap encourages the employees to be productive up to this limit; but it makes the employees less productive beyond the limit or cap value. This is because the employees will not receive any benefit after this limit. Therefore, the compensation cap will affect badly on the productivity of the economy. Thus, option ‘b’ is correct.

Economics Concept Introduction

Compensation cap: Compensation cap refers to the maximum limit on the salary paid to the employees.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 1, Problem 1MC

To determine

The reason for the badness of performance compensation caps.

Expert Solution & Answer

Explanation of Solution

The compensation cap refers to the maximum limit on the salary paid. The compensation cap encourages the employees to be productive up to this limit; but it makes the employees less productive beyond the limit or cap value. This is because the employees will not receive any benefit after this limit. Therefore, the compensation cap will affect badly on the productivity of the economy. Thus, option ‘b’ is correct.

Economics Concept Introduction

Compensation cap: Compensation cap refers to the maximum limit on the salary paid to the employees.

Answer 6

Chapter 1, Problem 1MC

To determine

The reason for the badness of performance compensation caps.

Expert Solution & Answer

Explanation of Solution

The compensation cap refers to the maximum limit on the salary paid. The compensation cap encourages the employees to be productive up to this limit; but it makes the employees less productive beyond the limit or cap value. This is because the employees will not receive any benefit after this limit. Therefore, the compensation cap will affect badly on the productivity of the economy. Thus, option ‘b’ is correct.

Economics Concept Introduction

Compensation cap: Compensation cap refers to the maximum limit on the salary paid to the employees.

Answer 7

Chapter 1, Problem 1MC

To determine

The reason for the badness of performance compensation caps.

Answer 8

Expert Solution & Answer

Explanation of Solution

The compensation cap refers to the maximum limit on the salary paid. The compensation cap encourages the employees to be productive up to this limit; but it makes the employees less productive beyond the limit or cap value. This is because the employees will not receive any benefit after this limit. Therefore, the compensation cap will affect badly on the productivity of the economy. Thus, option ‘b’ is correct.