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thanhha78 thanhha78
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2 years ago
Explain what will happen to the demand for labor, the equilibrium wage, and the equilibrium quantity of labor if a technological innovation makes workers more productive.
Textbook 

Survey of Economics: Principles, Applications and Tools


Edition: 6th
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Lightman030Lightman030
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A technological innovation that increases workers productivity will cause the marginal revenue product curve for labor to shift upward. Since the marginal revenue product curve is the firm's short-run demand curve for labor, this means that the demand for labor has increased, leading to a higher equilibrium wage and a higher equilibrium quantity of labor.
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