Assuming No Change in the Effort Curve of Employees,the Efficiency

question 57

Multiple Choice

Assuming no change in the effort curve of employees,the efficiency wage model implies that

• A)the real wage is rigid and equals the efficiency wage.
• B)the real wage exceeds the marginal productivity of labor.
• C)an increase in the marginal productivity of capital will increase the real wage.
• D)the real wage is procyclical.

---

Definitions:

Total Cost Variance

This refers to the difference between the budgeted or standard cost of production and the actual cost incurred.

Factory Overhead Cost

All indirect costs associated with manufacturing, excluding direct materials and direct labor. These can include utilities, maintenance, and salaries of non-direct labor employees.

Variance Report

A document that compares actual financial performance to planned or budgeted performance, highlighting variances between these figures.

Machine Hours

A measure of the operating time of machines or equipment, typically used in allocating manufacturing costs.