
FACTOR DEMAND: The willingness and ability of productive activities (that is, businesses) to hire or employ factors of production. Like other types of demand, factor demand relates the price and quantity. Specifically, factor demand is the range of factor quantities that are demanded at a range of factor prices. This is one half of the factor market. The other half is factor supply. The factors of production subject to factor demand include any and all of the four scarce resourceslabor, capital, land, and entrepreneurship. However, because labor involves human beings directly, it is the factor that tends to receive the most scrutiny and analysis.
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HOMOGENEOUS OF DEGREE N: A property of an equation the exists if independent variables are increased by a constant value, then the dependent variable is increased by the value raised to the power of n. The value of n can be greater than, less than, or equal to one. This property often surfaces in the analysis of production functions. If n = 1, then a doubling independent variables results in a doubling of the dependent variable and the production function has constant returns to scale. If n > 1, then a doubling independent variables results in more than a doubling of the dependent variable and the production function has increasing returns to scale. If n < 1, then a doubling independent variables results in less than a doubling of the dependent variable and the production function has decreasing returns to scale. See also  homogeneous  production function  independent variable  dependent variable  constant returns to scale  increasing returns to scale  decreasing returns to scale  homogeneous of degree one  homogeneous of degree zero  economies of scale  Recommended Citation:HOMOGENEOUS OF DEGREE N, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 20002018. [Accessed: October 16, 2018].
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MARGINAL PROPENSITY TO CONSUME The proportion of each additional dollar of household income that is used for consumption expenditures. The marginal propensity to consume (abbreviated MPC) is another term for the slope of the consumption line and is calculated as the change in consumption divided by the change in income. The MPC plays a central role in Keynesian economics. It quantifies the consumptionincome relation and the fundamental psychological law. It is also a foundation for the slope of the aggregate expenditures line and is critical to the multiplier process. A related consumption measure is the average propensity to consume.
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