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Related Flashcards
Related Topics
Cards In This Set
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Labor supply
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The willingness and ability to work specific amounts of time at alternative wage rates in a given time period, ceteris paribus
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Market supply of labor
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The total quantity of labor that worker are willing and able to supply at alternative wage rates in a given time period, ceteris paribus
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Opportunity cost
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The most desired goods and services that are forgone in order to obtain something else
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Demand for labor
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The quantities of labor employers are willing and able to hire at alternative wage rates in a given time period, ceteris paribus
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Derived demand
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The demand for labor and other factors of production results from the demand for final goods and services produced by these factors
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Marginal physical product
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The change in total output associated with one additional unit of unput
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Marginal revenue product
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The change in total revenue associated with one additional unit of input
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Law of diminishing returns
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The marginal physical product of a variable input declines as more of it is employed with a given quantity of other inputs
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Equilibrium wage
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The wage at which the quantity of labor supplied in a given time period equals the quantity if labor demanded
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Optimal mix of output
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The most desirable combination of output attainable with existing resources, technology and social values
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Market mechanism
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The use of market prices and sales to signal desired outputs
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Market failure
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An imperfection in the market mechanism that prevents optimal outcomes
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Public good
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A good or service whose consumption by one person does not exclude consumption by others
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Private good
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A good or service whose consumption by one person excludes consumption by others
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Free rider
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An individual who reaps direct benefits from someone else's purchase of a public good
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