CAPE Economics Unit 1 · 2013 · Paper 2 · Question 5(a)
Factor market theory and calculations.
Outline the marginal productivity theory of factor demand.
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Practise this questionOther parts of this question
- 5(b)(i)a)Calculate the marginal product for EACH additional worker.[3 marks]
- 5(b)(i)b)Calculate the marginal revenue product for EACH additional worker.[3 marks]
- 5(b)(ii)Determine the quantity of labour that will be employed per day.[1 mark]
- 5(b)(iii)Explain why more (or less) labour is NOT employed.[5 marks]
- 5(c)Evaluate the effects of a government minimum wage on the labour market.[6 marks]
- 5(d)Draw a demand and supply diagram of the labour market showing the decomposition of earnings into transfer earnings and economic rent.[4 marks]
More practice: the rest of this paper · more The Demand for and Supply of Factors questions · all CAPE Economics Unit 1 past papers