Exhibit 27-11 ​

question 44

Multiple Choice

Exhibit 27-11
​

-Refer to Exhibit 27-11. The firm in the exhibit is a monopsony. We have deliberately not identified the three curves in the exhibit. They are simply curves 1, 2, and 3. If (union) collective bargaining with the monopsony guarantees the wage rate that workers will be paid is W₂, then the factor supply curve is

• A)curve 2.
• B)curve 3.
• C)the curve that starts at W₂, goes to point B, then down to point C, then moves up curve 2.
• D)the curve that starts at W₂, goes to point D, and then moves up curve 2.
• E)the curve that starts at W₂ and goes to point D.

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After-Tax Lease Payment

Lease payments after accounting for taxes, reflecting the net cost to the lessee.

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The proportion of income or profit taken by the authorities as tax from a person or company.

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The reduction in income tax that results from the deduction of depreciation expenses on a company's tax return.