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value-added meaning?
product or a service that has value as it has work done on it, combined w/ other products = increases the value 2 the buyer as thats what the buyer pays for
wage rate meaning?
amount of money paid to workers for a service over period of time (price of labor), when wages rise, firm demands fewer workers, if it falls, they demand more
wage rate graph?
explanation:
$800 for 80 workers (when wages rise, demand for workers go down)
$600 for 100 workers (when wages fall, demand for workers go up)
people want more for low prices 🤷♀
law of demand: as quantity increases, price goes down
what are the factors affecting demand? (4)
demand for the product: (derived demand) demand that arises because there is demand for another good
availability: ppl want substitutes and companies replace people with machines (more efficient and cheap which is a substitute!)
labor productivity: if every worker produces output, the demand increases and is profitable & extra is sold
employment costs: increase in demand for air travel → increase in demand for cabin crew.
shift in demand curve graph?
W1 is the minimum wage rate (so it stays the same)
demand goes up (shift in the curve)
extra: minimum wage → garment workers
wage rate → regular workers
supply curve for labour meaning?
wages n quantity of labor supplied are proportionately related
if the wage rate rises, more people will want to work
supply curve for labor graph?
in graph:
$600 → attracts 40 workers
$800 → attracts 80 workers
supply increases (goes to the right)
law of supply: supply down → price up
supply up → price down
what are the factors affecting supply labor? (7)
POPULATION: when the size grows, more people want/need to work
MIGRATION
AGE DISTRIBUTION: basically developed countries have lots of old people (usually over 65), meaning theres less working-age folks to actually work → financial strain to society.
RETIREMENT AGE: people reach a certain age b4 benefitting from state pension, SL increases
SCHOOL LEAVING AGE: once they reach it they can work, but sudden changes (increasing age) reduces SL.
FEMALE PARTICIPATION: more women work cause society evolved, increases size of working population.
SKILLS & QUALIFICATIONS: SL increases if people are employable (if theyre skilled)
whats labor mobility?
when workers move geographically and occupationally between jobs
as they move, SL in a specific market boosts!
increase in supply curve graph?
whats wage determination?
determined by interaction of SL and D
equilibrium wage determined where SL and D is equal
→ basically equilibrium means its perfect ; nothing moves at the intersection
wage determination graph?
→ basically, 80 units and $800 is the intersection point, its the equilibrium and its perfect, nothing moves
however, they could have employed 120 employees for a high wage rate ($900)
what is the importance of quantity and quality?
when a business opens in a new location, they need to note the cost, quantity and quality
they need good educated workers, to ensure good quality, invest in training, enough workers to minimise costs, efficiency and profit
whats the impact of education and training on quality of human capital?
human capital is improved by training and developing
population level (PL) and how many people to hire is important n’ the quality
employers recruit skilled people
investment is needed in training and education to improve productivity
whats boom?
when business activity is so rapid, demand for goods increase and price n’ wages go up, unemployment falls
whats boom AND bust?
when the economy is active regularly and successful, but then suddenly fails.
Note 
Flashcard (50)