Textbook Guide Economics: Marginal Product, Demand Curve, Economic Equilibrium
98
ECO101H1 Full Course Notes
Verified Note
98 documents
Document Summary
The demand for labor: identical to other markets, labor markets are government by the law of supply and demand. The output price of a good or service can alter the labor- demand curve; increasing output prices can result in raising the value of marginal product of labor and increasing labor demand. The case can be replicated vice-versa (decrease output, decrease value, decrease labor demand). The technological changes of a good or service can alter the labor-demand curve; advancements in technology raises the marginal product of labor, increasing the demand for labor. The supply of other factors of production can alter the labor- demand of the good or service; a decrease in supply of other factors of production typically decreases the demand for labor. The supply of labor: the labor-supply curve has a direct relationship with the economic trade-off between work and leisure, the determinants of labor-supply that can cause its curve to shift are:
