Principles of Microeconomics / Unit 6 MIC 0530 short lesson, about 20 seconds
Choosing a Technology
Captions available
The idea
The same output can be made with more labor and less capital or the reverse. The firm picks the cheapest mix at current prices, using less of whatever gets dearer.
In practice
Street sweeping is brooms where labor is cheap, machines where it is dear.
Where people slip
This is why labor demand slopes down: a higher wage makes every labor-heavy method less attractive.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
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