Due to a Recession,the Acme Global Corporation Has a Labor

question 74

Multiple Choice

Due to a recession,the Acme Global Corporation has a labor surplus.It wants to find a way to reduce the surplus while both being fair to employees and being ready to respond to increased demand when the recession is over.Its best method for dealing with its surplus would be _________.

• A)job sharing
• B)early retirement
• C)hiring freezes
• D)natural attrition

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Definitions:

Variable Costs

Expenses that vary directly with changes in production or sales volumes, such as raw materials and direct labor costs.

Production Increases

A rise in the amount of goods and services produced over a given period of time by a business or economy.

High-low Method

A technique used in accounting and finance to estimate the variable and fixed components of a company's costs based on the highest and lowest levels of activity.

Total Fixed Costs

The sum of all expenses that remain constant regardless of the level of production or business activity.