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Chapter 12: The markets for factors of production, labor market - Coggle…

- - - - Value of marginal product = P x MPL
        
        P = MC = W/MPL
        
        Input demand and output supply are closely related to one another and are two sides of the same coin.
      - To maximize profit, hire workers up to where VMPL = wage
        
        The opportunity cost of labor when spent in leisure, is work
        
        Factors that affect the Labor Supply Curve
        
        Changes in labor-leisure trade off
        
        Opportunity for workers in other labor markets
        
        Immigration.
      - Anything that increases price or MPL will cause the demand curve to increase upward
        
        Things that shift the labor market
        
        Changes in output price
        
        Technological change
        
        The supply of other factors
    - - Minimum Wage above equilibrium creates unemployment and decreases total surplus