Regardless of Area of Expertise,a Public School Pays All Teachers

question 47

Multiple Choice

Regardless of area of expertise,a public school pays all teachers the same annual wage.At $70,000,it hires good teachers in all areas except science.Because science is a field in demand,the school can only hire poor science teachers.It would have to pay science teachers $90,000 to hire good science teachers.If one out of five teachers is a science teacher,what is the marginal expense of getting a good science teacher instead of a poor one?

• A) $90,000
• B) $100,000
• C) $20,000
• D) $450,000

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Definitions:

Labor Price Variance

The difference between the actual cost of labor and the standard or expected cost, used as a measure of financial performance.

Misallocation

The improper or inefficient allocation of resources, often leading to suboptimal outcomes or performance.

Production Department

A specific division within a company that is focused on the manufacturing or production of goods.

Manufacturing Overhead Volume Variance

The difference between the budgeted and actual amount of manufacturing overhead costs allocated based on production volume.