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DIFFERENTIALS AND DISEQUILIBRIUM
In a free enterprise system, workers aim at maximizing their wages. Hence, it would be expected that workers would move form low-paying industries to high-paying industries and the low-paying industries would raise wages so as to retain labour until wage rates were uniform for all workers.
In practice, however, we observe differentials in wages both between occupations and even within the same occupations. Differentials arising from the characteristics of the occupations are called compensating or equalizing differentials, because they represent pay units made to equalize the net remuneration and compensate the workers for differences in their jobs.
define scarcity and oppurtunity cost.show how these concepts are useful in managerial decision making
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The concept of point elasticity is applicable where change in price and the resulting change in quantity are infinite or small. Though, where change in price and consequent hunger
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