If TruLite's factory workers receive an hourly wage, described by the equation; Compensation = $5.00 + .10Q, where Q is the number of light switches installed per hour, then:
A. the employee can remain completely risk-averse.
B. there are no compensating differentials.
C. output becomes a subjective measure of performance.
D. the employee must accept risk of production variability.
Answer: D
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