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AGGREGATE EXPENDITURE EQUATION: An equation indicating that aggregate expenditures (AE) are the sum of consumption expenditures (C), investment expenditures (I), government purchases (G), and net exports (X-M), stated as: AE = C + I + G + (X-M). This equation surfaces in the Keynesian economic income-expenditure model in the form of the aggregate expenditures line. However, it's also central throughout the study of macroeconomics, including aggregate demand and the measurement of gross domestic product.
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Lesson 23: Factor Market Equilibrium | Unit 4: Monopsony
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Page: 17 of 24
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- The labor employment decision:
- A firm maximizes profit when the additional cost of a decision is equal to the additional revenue, whether that decision is producing output or employing factor services.
- The critical conclusion from this analysis is that a monopsony employs a factor such that marginal revenue product (MRP) is equal to marginal factor cost (MFC).
- MRP = MFC
- However, because this marginal factor cost (MFC) is greater than factor price (W) for monopsony, we have the secondary result that:
- MRP > W
- In other words, a perfectly competitive firm will hire workers up to the point where the extra revenue generated by the last worker is greater than the wage paid.
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BUREAU OF LABOR STATISTICS An independent agency of the Federal government that collects labor economics data in the United States economy, conducts economic research and analysis, develops and implements estimation methodologies, and disseminates economic statistics to the public. The information produced by the Bureau of Labor Statistics (BLS for short) allows the government, business leaders, researchers, and the public to follow and understand the performance of the U.S. economy, particularly in regard to workers, work places, and families of workers. The BLS also serves as a statistical resource to the U.S. Congress, other Federal agencies, and state and local governments.
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BLUE PLACIDOLA
[What's This?]
Today, you are likely to spend a great deal of time searching for a specialty store seeking to buy either a small, foam rubber football or an instructional DVD on learning to the play the oboe. Be on the lookout for bottles of barbeque sauce that act TOO innocent.
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Woodrow Wilson's portrait adorned the $100,000 bill that was removed from circulation in 1929. Woodrow Wilson was removed from circulation in 1924.
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"Inside the ring or out, ain't nothing wrong with going down. It's staying down that's wrong. " -- Muhammad Ali
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LWOP
Leave Without Pay
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