Basic concepts
What is labor cost?
The total expenses an employer pays for employees, including wages, benefits, and taxes.
What is a fixed wage?
A constant salary that does not depend on output.
What is labor productivity?
The amount of output produced per worker or per hour worked.
What is standard of living?
the level of well-being of individuals or a population, based on how well their material and non-material needs are satisfied.
Why do governments set minimum wages?
To ensure a basic standard of living for workers
What is a direct wage?
Payment given directly to workers for the work they perform.
What is a variable wage?
A wage that changes based on performance or output.
If total wages are 150,000,000 UZS and output is 1,000 units, what is labor cost per unit?
150,000 UZS per unit.
What factors influence the standard of living?
Income, prices, employment, housing, and social services.
How does inflation affect real wages?
It reduces real wages if prices rise faster than salaries.
What is nominal wage?
The amount of money paid to a worker without adjusting for inflation
What is indirect wage?
Non-cash benefits like insurance, meals, or housing.
How can a company reduce labor cost per unit without lowering wages?
By increasing productivity or efficiency.
If nominal wages increase but inflation rises more, what happens to living standards?
Living standards decrease.
What is social assistance?
Financial support provided by the government to low-income individuals.
What is a real wage?
The purchasing power of wages after adjusting for inflation.
What is overtime pay?
Extra payment for working beyond normal working hours.
How do you calculate labor cost per unit?
Total labor cost divided by total output.
What is income differentiation?
The differences in income levels among individuals or groups.
Why might increasing minimum wage cause unemployment?
Employers may reduce hiring due to higher labor costs.
What is the subsistence minimum?
The minimum income needed to cover basic living needs.
What is the main difference between basic and additional wages?
Basic wages are regular pay, while additional wages include bonuses and extra payments.
What is per capita income?
Total family income divided by the number of family members.
Why is food expenditure share important in analyzing living standards?
Higher food share usually indicates lower income levels.
What policy can reduce income inequality without raising wages?
Social transfers like pensions or benefits