Two principles of economics that help explain how wages are determined in a market economy are:
#1-People Face Tradeoffs and
#2-Governments Can Sometimes Improve Market Outcomes
Consider these principles when completing the assignment. Think of how they apply to the labor market for nurses.
Research the labor market for any state to determine how nursing wages are calculated. Use the internet for this research.
Cite the state and the URL of the Web site used in your research
Discuss which factors could influence the supply and demand of a nurse's position.
Discuss how a nurse's pay is determined and how the salary is structured.
Discuss what your chosen state can do to increase the supply of nurses.
Include a reference page in APA format
Labor Market Research: Determination of Nursing Wages
According to the principle, people face tradeoffs to get one thing, people have to sacrifice something else. This principle is similar to the concept of opportunity cost. Principle of government can sometimes improve market outcomes, states that when the market is unable to allocate the resources efficiently, government can interfere and change the outcome through its policy. Nursing labor market is the competitive one where each and every firm demands identical type of labor.
Nursing wages are determined on the basis of the demand and supply of the nurses. The opportunity cost of marginal labor hour is measured by the height of the market supply curve.
Quantity of labor hours
If there is a decrease in the supply of available labor from S1 to S0, the equilibrium wage rate will rise from W1 to W0 but the equilibrium quantity of labor hours will decrease Q1 to Q0.
This change in the supply of labor will also change the demand for labor, because if the wage rate increases, demand for labor supply decreases.
As a worker's wage increases, he is willing to supply a greater time and it increases marginal utility of working. When the wage increases at an extreme, there is the law of diminishing marginal utility in relation to his ...
Earlier to make a research on labor market and determination of nursing wages, one should go through various sources (online, offline) which will help in knowing various relevant facts and figures. I will be discussing wage determination and involvement of quantity of labor hours in it, as well as the factors that may affect the demand of nurses. References are included in this 785 word response.