chapter 9 for test

Question 1

factors that create different wage rates

Answer 1

different skills
educational qualifications
possession of innate talent
negotiating strength of TUs
nature/conditions of the job

Question 2

advantages of increasing the minimum wage

Answer 2

increased standard of living
increased aggregate demand
encourage employment
wage rates may increase overall

Question 3

MRP

Answer 3

marginal revenue productivity

the extra revenue earned when an additional unit of a factor of production is employed

Question 4

calculating MRP of labour

Answer 4

price x MPP

Question 5

when does a firm maximise profit

Answer 5

when the wage rate = MRP