Labour Market & Inequality Flashcards
1
Q
When is the equilibrium wage rate set in a free labour market?
A
Quantity demanded = the quantity supplied
2
Q
How is the demand for labour illustrated?
A
It is a downward-sloping curve as it is a derived demand
3
Q
What are the non-price determinants that shift the demand curve for labour?
A
- Demand for output
- Prices of other factors
- Advances in technology
4
Q
What are some factors that can affect the labor supply curve?
A
- The number of qualified people
- Non-wage benefits (eg. working environment, fringe benefits, status)
- Wage rate and non-wage benefits in alternative jobs
5
Q
What happens when labour and capital are used as complementary inputs in production?
A
When Capital rises, the demand for labour will fall.
