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Micro - Ch. 4
Microeconomics - Ch 4 - Labor and Financial Markets
| Term | Definition |
|---|---|
| interest rate | the "price" of borrowing in the financial market; a rate of return on an investement |
| minimum wage | a price floor that makes it illegal for a employer to pay employees less than a certain hourly rate |
| usury laws | laws that impose an upper limit in the interest rate that lenders can charge |
| households; firms | in the LABOR market, __________ are on the supply side of the market and _____ are on the demand side |
| financial capital | a market in which households and firms can be on either side of the market |
| salary; wage | in the demand and supply analysis of LABOR markets, the price can be measured by the annual ______ or hourly ____ received |
| 1) a change in the quantity demanded of the products that the labor produces 2) a change in the production process that uses more or less labor 3) a change in government policy that affects the quantity of labor that firms wish to hire at a given wage | what are the mains factors that can shift the demand curve in a LABOR market? |
| 1) workers' level of education and training 2) technology 3) the number of companies 4) availability and price of other inputs | demand in the LABOR market can also shift in response to what factors? |
| 1) how desirable a job appears to workers relative to the alternatives 2) government policy that either restricts or encourages the quantity of workers trained for the job 3) the number of workers in the economy 4) required education | what are the mains factors that can shift the supply curve in a LABOR market? |
| return; interest | in the demand and supply analysis of FIANCIAL markets, the price can be measured by rate of ______ or the ________ rate received |
| supply; demand | the quantity of financial markets is measured by the money that flows from those who ______ financial capital to those to ______ it |
| 1) if people want to alter their existing levels of consumptions 2) if the riskiness or return on one investment changes relative to other investments | what are the mains factors that can shift the supply curve in a FINANCIAL market? |
| 1) business confidence in the future 2) consumer confidence in the future | what are the mains factors that can shift the demand curve in a FINANCIAL market? |
| market price system | provides a highly efficient mechanism for disseminating information about relative scarcities of goods, services, labor, and financial capital |
| price controls | hide information about the true scarcity of products and thereby cause misallocation of resources |
Created by:
Kendall Posey
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