Wages Tend to Be Sticky

question 34

Multiple Choice

Wages tend to be sticky

• A)because of contracts,social norms,and notions of fairness.
• B)because of contracts,but not social norms or notions of fairness.
• C)because of social norms and notions of fairness,but not contracts.
• D)None of the above are correct.

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Definitions:

Fixed Manufacturing Overhead

Costs that remain constant regardless of the level of production, related specifically to the manufacturing process, such as rent, utilities, and salaries of permanent staff.

Machine-Hours

A measure of machine usage, representing the total hours a machine operates during a specific period.

Volume Variance

The difference between the expected (budgeted) volume of production or sales and the actual volume, affecting costs and revenues.

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead costs to products, calculated before the period begins based on estimated costs and activity levels.