Suppose That the Labor Supply Curve for a Large University

question 7

Multiple Choice

Suppose that the labor supply curve for a large university in a small town is given by w = 140 + 0.05L, where L is number of units of labor per week and w is the weekly wage paid per unit of labor. If the university is currently hiring 1,000 units of labor per week, the marginal cost of an additional unit of labor

• A) is twice the wage rate.
• B) equals the wage rate plus $50.
• C) equals the wage rate plus $100.
• D) equals the wage rate.
• E) equals the wage rate plus $150.

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Definitions:

De Facto Corporation

A company treated as legally incorporated, despite not having completed all required incorporation procedures, based on its actions or intentions to operate as a corporation.

De Jure Corporation

A corporation that has been lawfully established following the required statutes.

Redemption

The act of recovering ownership of something by paying a specified sum.

Buying Back

The act of a company purchasing its own shares from the marketplace, which can increase the value of remaining shares by reducing the supply.