Which one of the following statements about the application and/or implications of equity theory is false?

A) What may seem fair and equitable to a team leader might be perceived as unfair and inequitable by a team member after comparisons are made with other team members.
B) Feelings of inequity are determined solely by the individual's interpretation of the situation.
C) People who feel they are overpaid tend to decrease the quantity or quality of their work, whereas people who feel they are underpaid tend to increase the quantity or quality of their work.
D) People are less comfortable when they are under-rewarded than when they are over-rewarded.
E) In collectivist cultures, people seem to be more concerned about equality than equity.

Question

Nivetha Sankar · Accepted Answer

Final Answer : C, Explanation :  Equity theory suggests that people who perceive themselves as overpaid may experience guilt or discomfort and may increase their effort to restore equity, rather than decreasing the quantity or quality of their work. Conversely, those who feel underpaid may decrease their effort or quality of work as a response to perceived inequity.

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