Consider the Following Scenario When Answering the Following Questions

question 128

Multiple Choice

Consider the following scenario when answering the following questions:
In 2000,researchers Brigitte Madrian and Dennis Shea analyzed the 401(k) savings behavior of employees in a large U.S.corporation before and after an interesting change in the company 401(k) plan.
Before the plan change,employees were not automatically enrolled as participants in the company 401(k) plan upon being hired and were required to complete paperwork if they wanted to opt in.After the plan change,new employees were automatically enrolled in the 401(k) plan and were required to complete paperwork if they wanted to opt out.The amount of time and effort required to either opt in or opt out was approximately equal.None of the economic features of the plan changed.
-A finding of no significant difference in 401(k) plan participation after the plan change provides evidence that employee 401(k) participation decisions are made ________,and ________ effects do not exist in the context of 401(k) plan participation.

• A) rationally; rational
• B) irrationally; priming
• C) rationally; framing
• D) irrationally; framing
• E) rationally; fairness

---

Definitions:

Budgeted Manufacturing Overhead

Budgeted manufacturing overhead is the estimated amount of indirect costs that are expected to be incurred in the manufacturing process during a specified period.

Direct Labor-hour

A measure of the total amount of time worked by employees directly involved in manufacturing a product or providing a service.

Budgeted Manufacturing Overhead

The estimated overhead costs a company anticipates for manufacturing activities within a specified budget period, used for planning and control purposes.

Direct Labor-hour

A measure of the work input in terms of hours spent by workers directly involved in the manufacturing process.