Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
It decreases costs associated with turnover, thereby increasing the overall productivity of retained employees.
B
It has no effect on productivity since productivity is solely determined by the skills of the employees.
C
It increases the need for new training programs which can lower productivity.
D
It raises the wages of retained employees, thereby decreasing their motivation.
Understanding the Answer
Let's break down why this is correct
Answer
Marginal analysis in hiring looks at the additional benefits or costs of hiring one more employee. When a company improves employee retention, it means that workers stay longer and become more skilled in their jobs. This increased experience can lead to higher productivity, as seasoned employees often work more efficiently and require less training. For example, if a company keeps its sales team intact for several years, those employees will likely understand customer needs better and close more sales than new hires would. Therefore, better retention can increase the overall marginal productivity of the workforce, making each employee's contribution more valuable.
Detailed Explanation
When employees stay longer, companies save money on hiring and training new workers. Other options are incorrect because This idea suggests that only skills matter, but teamwork and experience also boost productivity; While new training can help, it doesn't always lower productivity.
Key Concepts
employee retention
marginal productivity theory
Topic
Marginal Analysis in Hiring
Difficulty
medium level question
Cognitive Level
understand
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