For a profit-maximizing, competitive firm, the value of the marginal product of labor
a. increases when the price of output decreases.
b. is the firm's demand for labor.
c. equals the marginal product of labor divided by the wage rate.
d. All of the above are correct.
b
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Use the information below to explain adjustments that move the economy to a long-run equilibrium. Assume that firms and workers have adaptive expectations
The current unemployment rate = 4%. The natural rate of unemployment = 6%. Last year's inflation rate = 3%. This year's inflation rate = 4%.
Students arriving late to class are a potential negative externality because their tardiness may interrupt the instructor and distract students
Can you think of any way in which this externality could be curbed? That is, can you think of any methods that could be employedto internalize this negative externality?