For Each of the Following Efficiency Standards,indicate Which Parties Are

question 188

Essay

For each of the following efficiency standards,indicate which parties are responsible for the standard and list one factor that should be used in setting the standard.
$$\begin{array} { | l | l | l | } \hline \textbf { Efficiency standard } & \textbf { Responsible party } & \textbf { Factor used in setting the standard } \\\hline \textbf { Direct materials } & & \\\hline \textbf { Direct labor } & & \\\hline\end{array}$$

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Definitions:

Monopolized Labor Market

A labor market where a single employer significantly controls the market for jobs and wages.

Equilibrium Wage

The wage rate that balances the quantity of labor supplied and the quantity of labor demanded in a labor market.

Marginal Product

The additional output generated by employing one more unit of a specific factor of production, holding other factors constant.

Optimal Labor Employment

The ideal quantity of labor that a firm employs where the marginal cost of hiring an additional worker equals the marginal revenue product.