Chapter28

Chapter28 - 10/8/2007 Economics 101 Chapter 28 I ) Derived...

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10/8/2007 Economics 101 Chapter 28 I) Derived Demands for Resources consumers’ demands for goods yield derived demands for the resources that produce these goods I I) The Demand for Labor Marginal Revenue Product (MRP) - the extra sales revenue from the output generated by an extra resource unit - calculated by marginal revenue times marginal physical product of labor (i) MR x MPPL Value of the Marginal Product - the social value pf the output produced by an extra resource unit is known as the value of the marginal product (VMP) Shifts in Demands for Labor - competitive demands for labor may shift in response to changes in: (i) output prices (ii) prices of other resources (iii) changes in technology (iv) the inherent productivity (quality) of workers Elasticity of Demand for Labor - the responsiveness of the amount of labor demanded ( L) to a change in wages ( w) is measured by the elasticity of demand for labor - % L / w - the elasticity of demand for labor is directly related to:
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This note was uploaded on 04/06/2010 for the course ECON 101 taught by Professor Balaban during the Spring '07 term at UNC.

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Chapter28 - 10/8/2007 Economics 101 Chapter 28 I ) Derived...

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