Case summary:
Company A has plans to improve the base wage of the employees to $16 per hour. It has a significant impact on both the company and employees. The total cost of the wage enhancement is $14million in 2015 and $25 million in 2016. The operating profit of Company A is $2.04 billion in 2014 and $2.4 billion in 2015
Company A’s CEO stated that the increased wage would increase the productivity. Person W and Person Z are the economists, who stated that the pay would increase in private-sector businesses in Country U. The company can be able to hire better workers and decrease disciplinary issues with the higher wages.
To analyze: The decisions of Company A using equity theory, expectancy theory, and two-factor theory.
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Chapter 8 Solutions
Business Essentials (11th Edition)
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