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Transcript of Chapter03
![Page 1: Chapter03](https://reader035.fdocuments.us/reader035/viewer/2022062514/55847c1ed8b42abf538b53d2/html5/thumbnails/1.jpg)
Copyright © 2009 Pearson Education, Inc.
Chapter 3
The Demand for Labor
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Copyright © 2009 Pearson Education, Inc. 3- 2
Table 3.1: The Marginal Product of Labor in a Hypothetical Car Dealership
(capital held Constant)
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Copyright © 2009 Pearson Education, Inc. 3- 3
Figure 3.1: Demand for Labor in the Short Run (Real Wage)
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Copyright © 2009 Pearson Education, Inc. 3- 4
Table 3.2: Hypothetical Schedule of Marginal Revenue Productivity of
Labor for Store Detectives
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Copyright © 2009 Pearson Education, Inc. 3- 5
Figure 3.2: Demand for Labor in the Short Run (Money Wages)
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Copyright © 2009 Pearson Education, Inc. 3- 6
Figure 3.3: Effect of Increase in the Price of One Input (k) on Demand for Another Input (j),
where Inputs Are Substitutes in Production
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Copyright © 2009 Pearson Education, Inc. 3- 7
Figure 3.4: The Market Demand Curve and Effects of an Employer-Financed
Payroll Tax
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Figure 3.5: Payroll Tax with a Vertical Supply Curve
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Copyright © 2009 Pearson Education, Inc.
Appendix 3A
Graphical Derivation of a Firm’s Labor Demand Curve
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Copyright © 2009 Pearson Education, Inc. 3- 10
Figure 3A.1: A Production Function
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Copyright © 2009 Pearson Education, Inc. 3- 11
Figure 3A.2: The Declining Marginal Productivity of Labor
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Copyright © 2009 Pearson Education, Inc. 3- 12
Figure 3A.3: Cost Minimization in the Production of Q*
(Wage = $10 per Hour; Price of a Unit of Capital = $20)
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Copyright © 2009 Pearson Education, Inc. 3- 13
Figure 3A.4: Cost Minimization in the Production of Q*
(Wage = $20 per Hour; Price of a Unit of Capital = $20)
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Copyright © 2009 Pearson Education, Inc. 3- 14
Figure 3A.5: The Substitution and Scale Effects of a Wage Increase