Recitation_2_F09

Recitation_2_F09 - 1 1.1 14.02 Recitation 2 Labor Market...

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1 14.02. Recitation 2. Labor Market 1.1 Labor Demand Let p w be the wage that the K ) is given Firm±s maximization problem: optimal choice of labor N d ± max N d pAK N d ± 1 ± wN d pAK N d ± 1 ). sell as much as it wants at a given price p . First order condition (using calculus): di/erentiate with respect to N d pAK (1 ± ) N d ± = w This is an inde/erence condition . It says that at the value of N d that Notice this is just the condition from the lecture notes:
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This note was uploaded on 10/25/2009 for the course 14 14.02 taught by Professor Geurrieri during the Fall '09 term at MIT.

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Recitation_2_F09 - 1 1.1 14.02 Recitation 2 Labor Market...

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