Chapter 18 Labor Markets marginal product labor (MPL) derived demand marginal product -find number of hires given MPL and wage labor demand labor demand shifts individual labor supply (reservation wage, income effect) supply of labor labor supply shifts wage differentials (what causes it) human capital risk premium labor markets (be able to illustrate changes to wage given shifts in supply or demand) labor unions statistical discrimination preference-based discrimination discrimination by government Chapter 24 Asymmetric Information asymmetric information principal- agent problem moral hazard problems and solutions to moral hazard adverse selection (problems and solutions) used car markets, health insurance, death spiral affordable care act signaling Chapter 11 Costs and Profit Maximization Under Competition Characteristics of a competitive market Long run Short run Fixed input Variable input Sunk cost Profit Total revenue Total cost Variable cost

Fixed cost Implicit cost Accounting profit vs economic profit Marginal revenue Marginal cost Average cost, average variable cost, average fixed cost Shutdown When to loss-operate Long Run Supply curve "planning curves" Increasing, Decreasing, and Constant cost industry Economies of scale