As Part of Its Proposal to Win the 2012 Olympics,London

question 119

Multiple Choice

As part of its proposal to win the 2012 Olympics,London developed a carbon offset plan to reduce the Games' impact on the environment.In 2011,the organisers decided to drop the plan to reduce emissions.We can conclude that

• A)the organisers were not making a rational decision.
• B)the marginal cost of reducing emissions exceeded the marginal benefit of reducing emissions.
• C)it is difficult to calculate the cost of reducing emissions.
• D)there were no incentives to reduce carbon emissions.
• E)the organisers were ignoring a sunk cost.

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Definitions:

Variable Manufacturing

Costs that vary directly with the level of production, such as raw materials or labor directly involved in making products.

Labour Cost

The total expenditure incurred by employers to compensate their employees, including wages, benefits, and payroll taxes.

Labour Rate

The amount of money that is paid for a specific quantity of labor, often referred to as the wage rate.

Labour Hours

The total hours worked by employees in the production of goods or delivery of services.