Which of the Following Is Not an Equilibrium Condition in a General

question 57

Multiple Choice

Which of the following is not an equilibrium condition in a general equilibrium analysis of a competitive economy?

• A)Input markets are in equilibrium.
• B)The quantity supplied equals the quantity demanded.
• C)Factor incomes are evenly divided.
• D)The marginal rate of transformation equals the marginal rate of substitution.

---

Definitions:

Direct Labor Hours

The total hours of labor directly involved in producing goods or services, often used as a basis for allocating overhead costs.

Indirect Labor

Labor costs not directly associated with the production of goods or services, such as administrative and support personnel.

Flexible Budget

A budget that adjusts or flexes with changes in volume or activity, allowing for more accurate budgeting and variance analysis.

Direct Labor Hours

Direct Labor Hours are the total hours worked by employees directly involved in the production of goods or services.