If Two Accountants Have Had the Same Education, Amount of Experience

question 57

Multiple Choice

If two accountants have had the same education, amount of experience, and work at the same type of job for the same profit-maximizing firm, which charges its clients a uniform hourly fee,

• A)they should earn the same amount of money
• B)the one whose job is riskier should be paid more
• C)the one whose job is riskier should be paid less
• D)the one who has a higher marginal product (due to ability)should be paid more
• E)the one who has a higher marginal product (due to ability)should be paid less

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Definitions:

Fixed Cost

Expenses that do not vary with the level of production or sales over a short period, such as rent, salaries, and insurance.

Volume Increases

An upward trend in the quantity of goods or services sold, which can impact revenue and profitability.

Costs Per Unit

The total expense incurred in the production of a single unit of a product, including both fixed and variable costs.

Fixed Cost Per Unit

The cost that remains constant in total but varies inversely with the level of production or sales volume.