At the End of 2018, Diatomic Company Implemented a New

question 103

Multiple Choice

At the end of 2018, Diatomic Company implemented a new labor process and redesigned its product with the expectation that input usage efficiency would increase. Now, at the end of 2019, the president of the company wants an assessment of the changes on the company's productivity. The data needed for the assessment are as follows: $\begin{array}{lrr}&2019&2018\\\text { Output } & 45,000 & 54,000 \\\text { Output prices } & \$ 10 & \$ 10 \\\text { Materials (lbs.) } & 22,500 & 22,950 \\\text { Materials unit price } & \$ 3 & \$4 \\\text { Labor (hrs.) } & 18,000 & 16,875 \\\text { Labor rate per hour } & \$ 5 & \$ 5 \\\text { Power (kwh) } & 11,250 & 14,625 \\\text { Price per kwh } & \$ 2 & \$ 3\end{array}$ By how much did profit change as a result of profitability changes in labor?

• A)$5,625 increase
• B)$45,000 increase
• C)$23,625 increase
• D)$23,625 decrease

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Definitions:

Psychological Needs

Fundamental human requirements for mental well-being, such as autonomy, competence, and relatedness.

Autonomous Motivation

The drive to engage in an activity out of genuine interest or personal value rather than external pressure.

Cultures

The collective norms, values, beliefs, and attitudes that characterize an organization or society and influence behaviors of individuals within it.

Need For Achievement

A psychological trait that drives individuals to pursue and attain challenging goals or standards of excellence.