A Newly Imposed Binding Minimum Wage

question 168

Multiple Choice

A newly imposed binding minimum wage:

• A) increases employment.
• B) decreases employment.
• C) maintains employment.
• D) leads to full employment.

---

Definitions:

Direct Labor Hours

The total hours worked by employees directly involved in manufacturing a product or delivering a service.

Materials Price Variance

The difference between the actual cost of materials and the expected (standard) cost, used to evaluate budgeting efficiency.

Materials Quantity Variance

The difference between the actual quantity of materials used in production and the standard amount expected, multiplied by the standard cost.

Total Materials Variance

The difference between the actual cost of materials used in production and their standard cost, reflecting efficiency or inefficiency.