At a plant where a union agreement sets annual salaries and conditions, annual labor costs usually ________.
A) are considered a variable cost
B) are considered a fixed cost
C) depend on the scheduling of floor workers
D) depend on the scheduling of production runs

Question

Quizplus · Accepted Answer

Union agreements typically set fixed salaries and conditions for workers, meaning that labor costs would be considered a fixed cost. It is not dependent on scheduling of workers or production runs, as these are operational factors that do not affect the fixed agreement with the union.

At a Plant Where a Union Agreement Sets Annual Salaries