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On the x-axis, label it HOURS WORKED and on the y-axis, label it WAGE RATE.
The individual supply curve is backward sloping. It starts off from the origin, rising up and out towards the right, until a certain wage rate, where it slopes backwards towards the left.
This slope is caused by two influencing factors:
1). INCOME EFFECT: This explains why the curve shifts outwards and upwards. As the wage rate increases, the individual worker will substitute his/her leisure time for higher wage rates.
2). SUBSTITUTION EFFECT: At a certain wage rate, a worker would prefer to substitute extra wages for more leisure time.
Suppose you worked for half an hour, and received $25million. You would surely prefer to substitute your leisure time for higher pay. But, what if you could work for an extra half an hour, and make enough money to satisfy your needs for a lifetime? Would you? Ofcourse you would.
But now I ask you, what happens after you've achieved your goal, of having enough money? You will prefer substituting higher pay for leisure. This explains why it slopes backwards at a certain wage rate.
There are some points to keep in mind, however. The individual's labour supply curve differs from one person to another, unlike the aggregate supply curve for the economy. The second point to note, is that; achieving a high enough wage rate to satisfy your needs for a lifetime, is a very far-off target for anyone to set. People like Bill Gates, Oprah Winfrey, and Steve Jobs are good examples here.
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Which way will an increase in labor cost shift the supply curve?
An increase in labor cost will decrease supply, so the supply curve will shift left.
Derive the wage offer curve and supply curve of labor and determine the equilibrium wage under perfect competition in the labor market?
The question doesn't provide any curve, because that's impossible on Answers.com. However it's easy to determine the equilibrium wage in a perfectly competitive market by equating the market demand for labour with the market supply of labour.
How do wages effect on labor supply?
A higher wage will increase the quantity supplied of labor, however it will not affect the entire labor supply curve. As for individual industries, it depends on the specific labor elasticity. If the Supply is inelastic, a relatively large change in wage will yield a relatively small change in quantity supplied. However, if the labor supply is elastic, a relatively small wage increase will return a relatively large quantity increase.
What is wage determination in perfect competition?
?Perfect competition in a resource market means that there aremany small buyers of the resource, and that none can influencethe market. The supply curve is identical to the marginalresource cost curve (MRC), and is horizontal. The wage is givendirectly by the intersection of the supply line and MRP curve(which is the demand for labor).Graph G-MIC9.1
Explain the effect an increase in the retirement age would have on a country's ppf curve?
An inrease in the retirement age would effectively increase a country's labor supply, shifting the production possibilities curve right.
Which way will an increase in labor cost shift the supply curve?
An increase in labor cost will decrease supply, so the supply curve will shift left.
Derive the wage offer curve and supply curve of labor and determine the equilibrium wage under perfect competition in the labor market?
The question doesn't provide any curve, because that's impossible on Answers.com. However it's easy to determine the equilibrium wage in a perfectly competitive market by equating the market demand for labour with the market supply of labour.
What did the railway strikes of 1877 do for workers?
Showed workers that organized labor was powerful.
What are some affects to the market supply curve?
cost of labor a change in the demand for the product the number of sellers offering the product
How do wages effect on labor supply?
A higher wage will increase the quantity supplied of labor, however it will not affect the entire labor supply curve. As for individual industries, it depends on the specific labor elasticity. If the Supply is inelastic, a relatively large change in wage will yield a relatively small change in quantity supplied. However, if the labor supply is elastic, a relatively small wage increase will return a relatively large quantity increase.
What is wage determination in perfect competition?
?Perfect competition in a resource market means that there aremany small buyers of the resource, and that none can influencethe market. The supply curve is identical to the marginalresource cost curve (MRC), and is horizontal. The wage is givendirectly by the intersection of the supply line and MRP curve(which is the demand for labor).Graph G-MIC9.1
Explain the effect an increase in the retirement age would have on a country's ppf curve?
An inrease in the retirement age would effectively increase a country's labor supply, shifting the production possibilities curve right.
Which of the following best explain the purpose of a supply curve?
A supply curve was developed to show how much of something can be made at a certain price. If you want to sell lemonade you cannot simply make lemonade and stand outside selling it for a quarter. You need to calculate costs (water, sugar, lemons, glasses, pitcher, labor, profit). The curve exists because different suppliers have different numbers. Some have lower or higher labor costs, affecting costs. Others have higher or lower expectations for profit. The higher the price, the more people there will be willing to provide that good or service. The supply curve is used together with the demand curve to find equilibrium, or the price where the most people (buyers and sellers) will be satisfied.
Explain how labor market equilibrium is affected by the supply and demand of labor in a Monopolistic Competition?
The labor market will reach equilibrium as the amount of workers willing to work for a certain price equals the amount of workers employers are willing to hire for that wage. On a supply and demand curve the employees represent the suppl side while the employers represent the demand side
What did the railway strike of 1877 do workers?
Showed workers that organized labor was powerful.
What did the railway strike of 1837 do for workers?
showed workers that organized labor was powerful
Why is the production possibility curve bowed out from the origin of the curve?
Diminishing Marginal returns to capital and labor.
