Principles of Microeconomics, 7th Edition

Published by South-Western College
ISBN 10: 128516590X
ISBN 13: 978-1-28516-590-5

Chapter 19 - Part VI - Earnings and Discrimination - Problems and Applications - Page 411: 7

Answer

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Work Step by Step

a. Merit pay could be desirable to encourage people to push themselves better and to produce excellent results. If they realize that it is possible to make extra money with better performance, they would be more productive. b. Some old workers who are not used to high-intensity work might have some words against this kind of payment. c. There are several merit-paying challenges, but it may be most important to mention that it is not that simple to measure every worker's contribution properly. It is also difficult to determine the most appropriate price list for each position and job description. d. They might have trouble locating appropriate teachers in that area.
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