Labour market SAQ

The Law of Diminishing Marginal Returns states that as increasing units of a variable factor of production (e.g., labour) are combined with a fixed amount of another factor of production (e.g., capital), the extra output generated by the extra units of the variable factor eventually begins to diminish.

The MRP curve slopes downwards due to the Law of Diminishing Marginal Returns, where the extra output generated by additional units of labour diminishes over time.

Labour is the human effort that goes into supplying goods and services.

<p>Nominal wage is the rate of pay or salary of an employee, while real wage is the purchasing power of wages.</p> Signup and view all the answers

<p>Factors that influence the demand for labour include demand for the firm’s output, technology, and employer’s PRSI.</p> Signup and view all the answers

<p>: Factors that influence the supply of labour include the size of the population of working age, the labour force participation rate, and the mobility of labour.</p> Signup and view all the answers

<p>Marginal Physical Product (MPP) of labour is the extra output generated as a result of employing an extra unit of labour.</p> Signup and view all the answers

<p>Marginal Revenue Product (MRP) of labour is the extra revenue generated as a result of employing an extra unit of labour.</p> Signup and view all the answers

<p>Occupational mobility of labour is the willingness of an individual to move from one occupation to another.</p> Signup and view all the answers

<p>Two factors that influence occupational mobility of labour are the qualifications/training required and restrictions such as the number of students allowed to study certain professions.</p> Signup and view all the answers

<p>Geographical mobility of labour is the willingness of an individual to move from one location to another to take up employment.</p> Signup and view all the answers

<p>Two factors that influence geographical mobility of labour are property prices and visas/work permits.</p> Signup and view all the answers

<p>A highly skilled worker has a higher MRP because their greater productivity leads to more output and revenue.</p> Signup and view all the answers

<p>High-quality capital, such as advanced machinery, increases the productivity of labour, thereby raising the MRP.</p> Signup and view all the answers

<p>Poor working conditions can lead to lower morale and reduced productivity, while good conditions can enhance morale and increase productivity.</p> Signup and view all the answers

<p>The theory of MRP might be less useful for setting wage rates for service workers because they do not produce a physical product, making it harder to measure their productivity in terms of output.</p> Signup and view all the answers

<p>The primary payment for labour is a wage.</p> Signup and view all the answers

<p>Technology can either increase demand for labour by creating new jobs and enhancing productivity or decrease it by automating tasks and reducing the need for human workers.</p> Signup and view all the answers

<p>State subsidies like the JobsPlus Scheme can increase the demand for labour by reducing the cost of hiring employees for employers.</p> Signup and view all the answers

<p>A higher labour force participation rate increases the supply of labour by encouraging more people to join the workforce.</p> Signup and view all the answers