Quiz 9 Flashcards
Minimum wage
a price floor that makes it illegal for an employer to pay employees less than a certain hourly rate
Marginal revenue product of labor
Increase in revenue from having 1 more worker
Marginal factor cost
Increase in total cost caused by buying 1 more input
Marginal product of labor
increase in total output gained by adding one more worker
Marginal productivity theory
under competition, factor inputs are paid their marginal revenue product
Poverty line
the specific amount of income one requires for a basic standard of living
Benefit reduction rate
the drop in benefits per dollar earned
Guaranteed income
Poverty trap
antipoverty programs set up so that government benefits decline substantially as people earn more income—as a result, working provides little financial gain
