ECO 365 Week 4 participation Principles of Microeconomics, Ch. 18: The Markets for the Factors of Production

Read Ch. 18 of Principles of Microeconomics:

• 18-1 The Demand for Labor, pp. 374-380
• 18-3 Equilibrium in the Labor Market, pp. 381-386

Consider the following as you read:

1. Understand the economy’s stock of equipment and structures.
2. Consider how much capital goes to employees.
3. Consider how much capital goes to property owners.
4. Consider why some workers earn higher wages than others, some landowners higher rental income than others, and some capital owners greater profit than others? Why, in particular, do computer programmers earn more than gas station attendants?
5. Understand the basic theory for the analysis of factor markets.
6. Understand the term factors of production and the three most important factors of production.
7. Understand the term derived demand.