The Difference Between a Piece Rate and an Hourly Rate

question 125

Multiple Choice

The difference between a piece rate and an hourly rate is:

• A) a piece rate is a wage for each piece of work completed whereas an hourly rate is a rate for each hour of work completed.
• B) a piece rate is only offered for non-contractual workers whereas an hourly rate is only offered for contractual workers.
• C) a piece rate is not tied to effort whereas an hourly wage is tied to effort.
• D) None of the answers is correct.

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Definitions:

Second Year

Typically refers to the second year in context, such as the second year of a business's operations, investment timeline, or an academic program, denoting a stage of progression or development.

EAR

Effective Annual Rate, a comprehensive measure of the cost of borrowing on a loan or earning on an investment, taking into account the effect of compounding interest.

APR

Annual Percentage Rate; the annual rate charged for borrowing or earned through an investment, including any fees or additional costs associated with the transaction.

Loan

A sum of money that is borrowed, which must be paid back with interest, typically used for significant purchases, investing, or to cover cash flow shortfalls.