If Both the Demand for Labor and the Supply of Labor

question 69

Multiple Choice

If both the demand for labor and the supply of labor increase,then the equilibrium wage rate ________ and the equilibrium quantity of labor ________.

• A) rises; increases
• B) might rise, fall, or not change; increases
• C) rises; might increase, decrease, or not change
• D) falls; increases
• E) falls; decreases

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Definitions:

Absorption Costing

A financial strategy that absorbs all the manufacturing outlays, encompassing direct materials, workforce costs, alongside both adaptable and unchanging manufacturing overheads, into the cost of a product.

Unit Product Cost

The cost allocated to a single unit of product, encompassing direct materials, direct labor, and allocated overhead costs.

Income Statement

A financial report outlining the revenues, expenses, and profits or losses of a company over a specific period.

Fixed Manufacturing Overhead

Costs associated with production that do not change with the level of output, such as rent for factory facilities or salaries of permanent staff.