About This Chapter
Factor Markets in Microeconomics - Chapter Summary and Learning Objectives
Let this chapter take you on a journey through factor markets in microeconomics concepts. The lessons serve as the perfect homework and test prep aids, boosting your knowledge of a variety of concepts, including marginal revenue product, market failure and derived factor demand. Exploring this chapter can also enhance your comprehension of marginal social costs, externality, remedy market failures and more.
Feel free to review the lessons in any sequence you desire from your home computer or mobile devices. Lessons are accessible any time, day or night, and each feature a short quiz you can use to gauge your comprehension of factor markets in microeconomics. A chapter exam is also available to assess your understanding of lesson concepts. After reviewing this chapter, you will have a better grasp of the following:
- The definitions of factor market, derived factor market and marginal revenue product
- How firms hire labor and acquire capital in factor markets
- Distribution of income
- Types of market failure
- Marginal social costs and benefits
- Negative and positive externality
- Ways to remedy market failures
|Factor Market: Definition & Examples||Discover the definition of a factor market and its importance in the economy and in business.|
|Derived Factor Demand: Definition & Overview||Study the definition and get an overview of derived factor demand.|
|Marginal Revenue Product: Definition & Formula||Define marginal revenue produce and learn its formula.|
|Hiring Labor & Acquiring Capital in Factor Markets||Examine the meaning of labor and capital markets, and describe the interaction of market participants and how firms acquire labor and capital.|
|Factor & Personal Distribution of Income||Describe the distribution of income among different factors of production and the distribution of income among income groups.|
|What Is Market Failure? - Definition & Types||Learn the definition of market failure and the difference between complete market failure and partial market failure.|
|Marginal Social Costs & Marginal Social Benefits||Differentiate between marginal social costs and marginal social benefits.|
|Negative Externality: Definition & Example||Discuss the definition and explore examples of negative externalities.|
|Positive Externality: Definition & Examples||Explain the meaning and understand examples of positive externality.|
|Remedying Market Failures||Understand ways to remedy market failures with a focus on externalities.|
1. Factor Market: Definition & Examples
We all know most finished products began with a bunch of different pieces. But did you know there is an actual market for those products and services needed to complete that finished product? Learn all about that market in this lesson.
2. Derived Factor Demand: Definition & Overview
Sometimes we as consumers demand a product. When we want more of something, oftentimes the supplies needed to make that product also increase in number. In this lesson we will learn about derived factor demand and how it relates to inputs and outputs of production.
3. Marginal Revenue Product: Definition & Formula
When should you hire an additional employee? When should you buy a new machine? These questions can be answered by understanding marginal revenue product. In this lesson we will cover the definition and formula to calculate marginal revenue product.
4. Hiring Labor & Acquiring Capital in Factor Markets
Supply and demand concepts are everywhere in economic activity. In this lesson we will discuss how labor and capital decisions are interwoven in factor markets.
5. Factor & Personal Distribution of Income
This lesson will introduce you to the ways economists measure the distribution of income in a country. The distribution of personal income among individuals and factor income among groups in the economy will be explored.
6. What Is Market Failure? - Definition & Types
Making sure there are enough of the right products for everyone who wants to purchase them is a difficult task. This is because there are factors that cause the market to fail. In this lesson we will learn all about market failure and the different types.
7. Marginal Social Costs & Marginal Social Benefits
In this lesson, you will learn about marginal social costs and marginal social benefits to help you make important decisions. We will look specifically at what makes up the equations and how each variable is defined.
8. Negative Externality: Definition & Example
In this lesson we will learn about negative externality. We will look at examples and discover who a negative externality affects. The lesson will conclude with a summary and a quiz.
9. Positive Externality: Definition & Examples
In this lesson, we'll explore the marginal benefit to society that occurs with an economic transaction. We'll analyze how positive externality impacts the demand curve and price, then learn how the benefit to a population can be subsidized.
10. Remedying Market Failures
Unfortunately, the economy does not always function perfectly. This can result in market failures. When this happens, a solution needs to be created to fix the problem. Come along as we learn about some of the remedies for correcting market failures.
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Other chapters within the AP Microeconomics: Exam Prep course
- Foundational Economic Concepts
- Economic Systems & Structures
- Supply & Demand in Markets
- Elasticity of Markets in Microeconomics
- Microeconomics & Consumer Behavior
- Production & Costs in Economic Markets
- Firm Behavior & Monopoly in Microeconomics
- Public Goods & Government in Microeconomics
- Public Policy, Government & Microeconomics
- AP Microeconomics Flashcards