Cheap Talk Works at Placing Workers in the Right Job

question 96

Multiple Choice

Cheap talk works at placing workers in the right job as long as

• A) the interests of the worker and the firm coincide.
• B) all workers want the most demanding jobs regardless of their abilities.
• C) workers have different ability levels that are unknown to firms.
• D) firms are not profit maximizers.

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Definitions:

Direct Manufacturing Cost

Costs that are directly attributable to the production of goods, such as raw materials and direct labor expenses.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold in a company, including the cost of materials and direct labor.

Gross Margin

The difference between revenue and the cost of goods sold, often expressed as a percentage of revenue, indicating the efficiency of a company in managing its production costs.

Relevant Range

The span of operations in which the beliefs regarding variable and fixed cost dynamics are accurate.