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Products and labour are purchased to manufacture new products which have a higher value in the market than their cost price, resulting in a profit from the added value. In such an economy, Marx argues, what directly regulates the economic exchange of new labour-products is not the law of value, but their prices of production.
Labor-power might be seen as a stock which can produce a flow of labor. Labor, not labor power, is the key factor of production for Marx and the basis for earlier economists' labor theory of value. The hiring of labor power only results in the production of goods or services ("use-values") when organized and regulated (often by the "management ...
In construction, the costs of materials, labor, equipment, etc., and all directly involved efforts or expenses for the cost object are direct costs. In manufacturing or other non-construction industries, the portion of operating costs that is directly assignable to a specific product or process is a direct cost. [4]
Cost the limit of price was a maxim coined by Warren, indicating a (prescriptive) version of the labor theory of value. Warren maintained that the just compensation for labor (or for its product) could only be an equivalent amount of labor (or a product embodying an equivalent amount). [42]
It’s sometimes referred to as an indirect cost, or “overhead.” ... = $10,000 (fixed costs) / $5.00 (price per unit) – $3.00 (cost per unit) X = $10,000 / ($5.00 – $3.00)
A price level must be assumed, rather than be deduced from labour-values. Total product prices can equate with total product labour-values (i.e. product prices are proportional to product labour-values), or the sum of profits can equal the total surplus value, but these two equations cannot hold at the same time.
Hence, the price of labor is also equal to the cost of production of labor. But, the costs of production of labor consist of precisely the quantity of means of subsistence necessary to enable the worker to continue working, and to prevent the working class from dying out. The worker will therefore get no more for his labor than is necessary for ...
The marginal revenue product of labour can be used as the demand for labour curve for this firm in the short run. In competitive markets , a firm faces a perfectly elastic supply of labour which corresponds with the wage rate and the marginal resource cost of labour (W = S L = MFC L ).