Fringe Benefit Packages Differ Substantially from One Firm to the Next

question 32

Multiple Choice

Fringe benefit packages differ substantially from one firm to the next because:

• A)labor market information is costless
• B)adjustment periods tend to be short
• C)worker mobility costs are low
• D)firms may structure their fringe benefit packages to attract specific types of workers

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Definitions:

Marginal Cost

The additional cost incurred in producing one more unit of a good or service.

Willingness to Pay

The maximum amount an individual is prepared to spend for a good or service, reflecting the value they derive from it.

Opportunity Cost

The cost of foregoing the next best alternative when making a decision or choosing to allocate resources in a certain way.

Marginal Cost

The cost increase associated with the manufacture of an additional good or service unit.