00:01
Once again, welcome to a new problem in economics.
00:07
We always have on the x axis, we have the quantity.
00:14
And then on the y axis, we have the prize.
00:16
And so the demand graph, or rather the supply graph, is upward sloping.
00:23
And the reason why the supply graph is upward sloping is because as the quantity demanded increases, so does the price of the product by the suppliers.
00:37
The demand graph is downward sloping, and the reason why the demand graph is downward sloping is because as the quantity demanded increases, or rather as the price decreases, as the price decreases, the quantity demanded is going to increase.
01:04
So people are going to buy more products if you tend to lower the price.
01:12
And so now we have a new problem.
01:15
And in this particular problem, we have the labor market.
01:21
And in the labor market, the x -axis, represents the quantity of labor, and that's in terms of employment, the people who want to be employed.
01:37
And then the y axis represents the wages, so that's the wage in dollars, and that's dollars per hour, dollars per hour.
01:52
And so in terms of the supply graph and the demand graph.
01:58
This is the initial scenario when it comes to labor and wages, meaning that when the price of labor is w1, the amount of labor supplied is l1.
02:13
So we're going to say that the market equilibrium wage is l1 is l1.
02:31
Is w1 and the equilibrium employment is l1.
02:49
Remember the equilibrium point this is the market clearing point where there is an agreement there is an agreement there's an labor and wages.
03:11
So there's an agreement between labor and wages...