Respuesta :
In a competitive labor market, the demand for and supply of labor determine the equilibrium wage rate and the equilibrium level of employment.
The relationship between how these markets determine the wage rate and the quantity of labor that should be employed is explained below.
All goods and services are made up of different resources known as factors of production.
Land, labor, capital, and entrepreneurship are the four primary components of production.
The labor market, like any other market, is governed by supply and demand laws.
The laws interact to determine the point at which the quantity required equals the quantity supplied.
The equilibrium consists of two components: equilibrium quantity and equilibrium price.
Distinct sorts of labor have different markets.
Some unskilled workers are paid less because of their skill level.
There are more subcategories at the higher ability levels.
Welders are one example of a skilled trade that is currently in high demand.
- Welders are in short supply since there aren't enough of them.
- Companies require trained people, including welders, to manufacture their products, thus manufacturers compete for competent welders by giving greater compensation.
Hence, the relationship between how these markets determine the wage rate and the quantity of labor that should be employed is as explained above.
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