Figure: Preferences and Indifference Curves Refer to the Figure

question 14

Multiple Choice

Figure: Preferences and Indifference Curves Refer to the figure. According to the indifference curves for Kiwis and Nuts, which statement is TRUE?

• A) Indifference curve U₁ provides higher utility than indifference curve U₂.
• B) Bundle A is preferred to Bundle B.
• C) Bundle C is preferred to Bundle D.
• D) Bundle C is preferred to Bundle B.

---

Definitions:

Benefit Costs

The expenses incurred by employers for the benefits provided to employees, such as health insurance and retirement plans.

Skill-Based Pay Plans

Compensation systems that set pay levels based on the skills, knowledge, or competencies an employee acquires, rather than the job position alone.

Pay-for-Knowledge Plans

Compensation strategies that reward employees for acquiring and using specific knowledge or skills that benefit the organization.

Traditional Incentive Systems

Reward structures typically based on performance outcomes, aiming to motivate employees through financial incentives like bonuses, raises, and commissions based on their job performance or targets achieved.