time available for purposes other than earning money to buy marketed goods.

the additional cost of employing an additional unit of a factor of production.

a market in which there is a monopsonist is a monopsony.

demand for a factor is a derived demand. It results from (that is, it is derived from) the demand for the output being produced.

a firm determines the cost-minimizing combination of inputs using the cost-minimization rule: employ factors so that the marginal product per dollar spent on each factor is the same.

a single buyer in a factor market.

the improvement in labor created by the education and knowledge of members of the workforce.

shows how the marginal revenue product of that factor depends on the quantity of the factor employed.

the division of total income among land, labor, capital, and entrepreneurship.

shows how the quantity of labor supplied by an individual depends on that individual’s wage rate.

the payment to a factor of production in excess of the minimum payment necessary to employ that factor.

every factor of production is paid the equilibrium marginal revenue product.

the additional revenue generated by the last unit of that factor employed in the factor market as a whole.

often referred to simply as “capital”—consists of manufactured productive resources such as equipment, buildings, tools, and machines.

the additional revenue generated by employing one more unit of that factor.

some employers pay an above-equilibrium wage as an incentive for better performance and loyalty.

wage differences across jobs that reflect the fact that some jobs are less pleasant or more dangerous than others.

organizations of workers that try to raise wages and improve working conditions for their members by bargaining collectively.

decisions about labor supply result from decisions about time allocation: how many hours to spend on different activities.

either land or capital is the cost, explicit or implicit, of using a unit of that asset for a given period of time.