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Question - A company is currently preparing a quotation for a new contract which will require 100 labour hours per week over the next eight weeks.
Due to labour being in short supply, two scenarios are under consideration:
(1) To pay existing staff an overtime premium of 50% for the duration of the contract. Existing staff are currently paid £26 per hour.
(2) To recruit labour on a temporary basis for the contract duration. The rate per labour hour will be £30.
What is the relevant cost of skilled labour to the company for this new contract?
A. $3,000
B. $3,900
C. $31,200
D. $24,000
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