Assume That Wages Expense Is a Variable Cost and That

question 136

Essay

Assume that wages expense is a variable cost and that the relevant range is 10,000 to 15,000 labor hours.Within that range,the cost is $15 per hour.What can you assume about wages expense outside this range?

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Definitions:

Aggregate Demand

The total amount of goods and services in an economy that will be purchased at all possible price levels in a given period.

Aggregate Supply

Aggregate supply is the total supply of goods and services that firms in a national economy plan to sell during a specific time period, affected by several factors including production costs and labor availability.

Short-Run

A period in economics where at least one input is fixed, usually applied to analyze immediate impacts on the economy.

Money Supply

The full quantification of financial means in an economy at a certain point in time, including tangible currency like coins and notes and virtual balances in checking and savings accounts.