Chapter 23 Figure: Weekly Pay Weekly Pay $1.000 900- 800 700- 600 500 Firm A Fir
ID: 1115439 • Letter: C
Question
Chapter 23 Figure: Weekly Pay Weekly Pay $1.000 900- 800 700- 600 500 Firm A Firm B 400- 200 100 - 23 45678 9 10 Number of advertising spots sold per week 4. (Figure: Weekly Pay) Firms A and B are radio stations that hire salespeople to sell advertising slots. The firms' compensation schemes appear in the figure. Which of the following statements is TRUE? (1 pt, CHOOSE 1) I. A worker that could sell seven ads per week would want to work for Firm A II. A worker that could sell five ads per week would be willing to work for either firm. III. A worker that could sell only three ads per week would want to work for Firm B. A) I, II, and III B) I and III only C) II only D) I and II only 5. A firm would choose to pay workers with a piece rate system over a wage system when: (1 pt, CHOOSE 1) A) it is difficult to measure output. B) employees work from home, have little supervision, but produce measureable output. C) it is easy for employees to artificially boost their output numbers D) they are in an industry with little to no quality control.Explanation / Answer
Ans 4)
A) I,II and III
Worker selling 7 ads per week will work under firm A because his compensation would be 700 given by firm A. From a figure we get to know positive relation of firm A between number of ads sold per week and weekly pay.And his compensation is more than firm B here.
A worker that could sell 5 ads would get compensation of 500 per week so he would choose either of the two firms.
Whereas worker who could sell 3 ads per week will work for only firm B because from a figure we get to know that for whatever number of ads you sell worker is compensated for 500 per week by firm B higher than compensation of firm A.
Ans 5)
B
Piece rate system compensates employees an amount for each unit of work completed.Employees working from home having little supervision but produce measurable output.It is a cost effective method being only paid for work completed. This system prefers more quality than quantity.Althogh it is difficult to measure output in piece rate than wage system because it is difficult to attribute output to any particular worker.
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