The Existence of Union Wages, Efficiency Wages, and the Minimum

question 151

Multiple Choice

The existence of union wages, efficiency wages, and the minimum wage

• A)raises the real wage rate above the equilibrium wage rate and lowers the natural unemployment rate.
• B)does not have an impact on the equilibrium wage rate or on the amount of unemployment.
• C)raises the real wage rate above the equilibrium wage rate and raises the natural unemployment rate.
• D)lowers the real wage rate below the equilibrium wage rate and creates a shortage of labor.
• E)raises the real wage rate above the equilibrium wage rate and creates a shortage of labor.

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Definitions:

Labour Rate Variance

The difference between the actual wage rate paid to workers and the expected (or standard) wage rate, multiplied by the actual hours worked.

Direct Labour Costs

Costs that can be directly attributed to the production of goods or services, such as wages for workers manufacturing a product.

Variable Overhead Spending Variance

The difference between the actual variable overhead costs incurred and the expected costs based on a predetermined standard.

Variable Manufacturing Overhead Cost Incurred

The variable expenses directly related to the manufacturing process, such as materials and labor, that change with production levels.