Suppose That the Labor Supply Curve for a Large University

question 12

Multiple Choice

Suppose that the labor supply curve for a large university in a small town is given by w = 160 + 0.05L, where L is number of units of labor per week and w is he 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)equals the wage rate.
• B)equals the wage rate plus $50.
• C)is twice the wage rate.
• D)equals the wage rate plus $100.
• E)equals the wage rate plus $150.

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Definitions:

Consolidation Elimination

The process of removing intra-group transactions and balances from the consolidated financial statements of a group of companies.

Cost Method

An accounting approach for investments, where the investment is recorded at its acquisition cost without reflecting the investee's performance.

Straight Line Amortization

A technique for distributing the expense of an intangible asset evenly over its lifespan in yearly increments.

Goodwill

The intangible asset that arises when a company acquires another company for more than the fair value of its net identifiable assets.