Why Would Economists Find It Surprising If the CEO of a Large

question 27

Multiple Choice

Why would economists find it surprising if the CEO of a large company does his or her own housework?

• A) The opportunity cost of a CEO's time is quite high because he or she has an abundance of time to spend on housework.
• B) The opportunity cost of a CEO's time is quite low because he or she has a scarcity of time to spend on housework.
• C) The opportunity cost of a CEO's time is quite low because he or she has an abundance of time to spend on housework.
• D) The opportunity cost of a CEO's time is quite high because he or she has a scarcity of time to spend on housework.
• E) The opportunity cost of a CEO's time is equal to that of everyone else that works at the same company.

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Definitions:

Rational-Legal Authority

A concept in sociology that denotes a form of leadership in which authority is largely tied to legal rationality, legal legitimacy, and bureaucracy.

Bureaucratic Structure

An organizational design characterized by a hierarchy of authority, a clear division of labor, explicit rules and procedures, and impersonality in managerial decisions.

Capitalism

An economic system characterized by private or corporate ownership of capital goods, investments determined by private decision, and prices, production, and the distribution of goods determined mainly by competition in a free market.

Emotional Labor

The process of managing feelings and expressions to fulfill the emotional requirements of a job, often in service-oriented professions.