All of the Following Statements About Business Income Insurance Are

question 23

Multiple Choice

All of the following statements about business income insurance are true EXCEPT

• A)Business income is defined as total sales that would have been made if the loss had not occurred.
• B)Payroll is considered a continuing normal operating expense.
• C)Business income insurance does not cover the physical damage caused by a peril which created the interruption in business.
• D)The business income coverage form can be purchased with a coinsurance requirement.

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Definitions:

Monopsonistic Employer

An employer who has significant control over the labor market and is the only or dominant buyer of labor, allowing them to influence wages and employment conditions.

MRP

The marginal revenue product, representing the additional revenue generated from employing one more unit of a factor, such as labor or capital.

Labor Supply Curve

A graphical representation showing the relationship between the wage rate and the quantity of labor workers are willing to offer.

Wage Rate

The fixed amount of compensation paid to an employee by an employer in exchange for work performed, typically expressed per hour, day, or piece produced.