Lesson 22-Labor Market

Question 1

Define labor market

Answer 1

The demand for labor and supply of labor

Question 2

What is the demand for labor

Answer 2

Demand for labor depends on the demand for the product of labor

Question 3

What kind of relationship is seen between labor and wage rates?

Answer 3

Negative relationship

Question 4

What is the supply for labor

Answer 4

The number of people in the working age, who are able to and willing to work

Question 5

What kind of relationship is seen between supply and wage rate

Answer 5

When the wage rate is high, supply of labor is high as workers will be more motivated to work and vice versa. There is a positive relationship

Question 6

State 3 factors affecting the demand for labor

Answer 6

1.Derived demand- The demand for labor will go up if the demand for the product of labor goes up
2. If the labor is more productive the demand will increase
3. If new machinery and technology is cheaper the demand for labor will be low

Question 7

Factors affecting the supply of labor

Answer 7

1. Higher wage rates will encourage a higher supply of labor
2. If facilities are provided by employer, it would encourage workers to work for them thereby increasing supply
3. The supply of labor will be high if there are more people in the working age
4. If there are more education and training facilities supply will increase