Question

You are a professor of economics at a university.​ You've been offered the position of serving as department​ head, which comes with an annual salary that is ​$9.500 higher than your current salary.​ However, the position will require you to work 200 additional hours per year. Suppose the next best use of your time is spending it with your​ family, which has value of ​$20 per hour. What is the difference in the net benefit from becoming the department​ head?

Answer 1

$ 27.50 per hour

$ 5,500.00 per year

Step-by-step explanation:

$

Salary upgrade: 9,500.00 annual

Additional Working Hours : 200.00 yearly

Family hours value: 20.00 hourly

Additional Working Hours: Value determination:

Salary upgrade =

Additional Working Hours

9.500 / 200 = 47.50

Additional hours value: $ 47.50

Net Benefit determination

Additional Working hours value - Family Hours value =

47.50 - 20.00 = 27.50

$ 27.50 per hour

$ 5,500.00 per year ( 27.50 * 200 hours )