Cindy Has $70 a Month to Spend,and She Can Spend

question 109

Multiple Choice

Cindy has $70 a month to spend,and she can spend as much time as she likes playing golf and tennis.The price of an hour of golf is $10,and the price of an hour of tennis is $5.If Cindy equalizes the marginal utility per hour from golf and from tennis,she

• A)can increase her total utility by spending less time golfing and more time playing tennis.
• B)can increase her total utility by spending more time golfing and less time playing tennis.
• C)maximizes her total utility.
• D)can increase her total utility only if the price of golf decreases.
• E)cannot increase her total utility.

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Definitions:

Geographic-Based Pay

A compensation strategy that adjusts an employee's pay based on the cost of living and market wage rates in the geographic location where they work.

Market Pricing

The process of determining the external value of jobs within an organization by comparing the organization's jobs to similar jobs in the external labor market.

Small Firms

Businesses or enterprises with a small number of employees, potentially offering more personalized services and having less market influence than larger companies.

Performance Pay

A compensation strategy that ties employee payment directly to their performance outcomes or achievements.