(2) Chapter 4 - The Labour Market Flashcards by Chris Man | Brainscape

Q

What determines a firms demand for labour?

A

Productivity of additional units of labour (Marginal Physical Product, MPP)

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Q

What 4 determinants of LABOUR DEMAND?

A

Wage rates
Labour productivity
Price of substitute goods
Other labour costs

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Q

What 4 factors determine the elasticity of demand for labour?

A

Ease of substitution
Time
Elasticity of demand for the good/service
Proportion of labour cost to total cost of production

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