Suppose That the Labor Market for Life Guards Is Initially

question 510

Multiple Choice

Suppose that the labor market for life guards is initially in equilibrium. Then a new television series debuts which glamorizes the social opportunities for life guards. What happens to the equilibrium wage and quantity of life guards?

• A)Both the equilibrium wage and quantity increase.
• B)Both the equilibrium wage and quantity decrease.
• C)The equilibrium wage increases, and the equilibrium quantity decreases.
• D)The equilibrium wage decreases, and the equilibrium quantity increases.

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Definitions:

Sales

The process where goods or services are traded for money, which constitutes the main revenue stream for the majority of companies.

Operating Cycle

The period it takes for a business to buy inventory, sell it to customers, and collect the cash from these sales.

Credit Sales

Revenues earned by selling goods or services that are paid for over time under agreed payment terms, rather than paid in full upfront.

COGS

Acronym for Cost of Goods Sold, which refers to the direct costs attributable to the production of the goods sold by a company.