In Equilibrium, a Decrease in Matching Efficiency

question 45

Multiple Choice

In equilibrium, a decrease in matching efficiency

• A)decreases the unemployment rate and vacancies are constant.
• B)increases the unemployment rate and vacancies decrease.
• C)decreases the unemployment rate and vacancies increase.
• D)increases the unemployment rate and vacancies increase.
• E)increases the unemployment rate and vacancies are constant.

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Definitions:

Overhead

All ongoing business expenses not directly attributed to creating a product or service. This includes costs like rent, utilities, and salaries of employees not directly involved in production.

Standard Labor Hours

Refer to the predetermined amount of time expected to be spent to complete a task under normal conditions.

Direct Labor Rate Variance

The difference between the actual labor rate paid to workers and the standard labor rate, multiplied by the total hours worked.

Direct Labor Hours

The total hours worked by employees directly involved in manufacturing a product or delivering a service.