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Using the value of marginal product, explain why women are not likely to earn less than men in a competitive market

Economics Dec 14, 2020

Using the value of marginal product, explain why women are not likely to earn less than men in a competitive market.

Expert Solution

In a competitive market, the labor market equilibrium can be obtained at the point where Marginal Cost equates Marginal Revenue Product of labor. The marginal revenue product assumes the demand curve of labor. The labor market equilibrium arises by analysing the value of marginal product.
In a competitive market, women are equally in a way to gain wages like men in competitive market. The competitive labor market analysis only the value of marginal product not the gender. In a competitive labor market, labor is demanded based on the value of product that labor created. What the additional labor create determined the demand for labor. The gender discrimination or wage differential seldom exist in the competitive labor market.

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