Transcript Powerpoint Friday Land Labour 14

Goals for today’s lesson
 Outline the supply for land
 Analyse the demand for land
 Examine the factors that influence the price paid
for land.
 examine the factors that need to be considered
before deciding where to locate a factory .
 Define Labour
What is Land?
Land:
 Factor of production,
 Anything provided by nature that helps in the
production of output, including goods, services
and wealth
Economic Characteristics of land
Land is fixed in supply
There is a limited amount of resources provided by
nature.
The supply of land of land is perfectly inelastic.
If demand for land increase supply cannot increase
therefore it is fixed. An increase in demand for land
will increase the price.
Land is fixed in supply
 Perfectly inelastic supply
 Occurs when the supply of a product cannot be
changed in the short run, no matter what the price is.
 Example Supply of land, seating capacity of a stadium
Demand for Land
The demand for land is derived
 Land itself is not demanded in its own right, but it
is sought for the goods it helps to produce.
Demand for Land
The demand for land depends on its MRP
The rent that will paid for land depends on its
marginal rate of productivity (MRP)
MRP in return is related to the selling price of the
finished good.
Therefore, we can conclude that the selling price of the
good will determine the rent to be paid for the land
8
Rent
As the demand
for land
increases,
rent increases
Rent
S
Supply of land is
fixed therefore
supply curve is a
vertical straight line
D3
P2
P1
D1
D3
P3
D2
D1
As the demand
for land
decreases, rent
decreases
D2
Q
Quantity
Now it’s your turn...
Think, Pair, Share
 Think on your own first and write down some of the
factors that influence the price paid for land.
1 minute
 Then turn to their neighbour (pairs) and discuss
some of the key points and see if you can come up
with any more ideas.
2 minutes
 Feedback your ideas to the class
Factors that influence the price
paid for Land
 Demand for Private houses
 Road Building
 Business Demand
 Public Amenities
Now its your turn!!
 In groups of 3
 Using Paper provided
 Expand on each of the area listed above with regard
to the factors that influence the price paid for land.
 You have 4 minutes to do this
 You must elect a spokesperson, writer and timekeeper
for each group
Factors that influence the price
paid for Land
Demand for Private Houses:
 Building Boom in 2000’s = prices of land in places
where housing was demanded increase dramatically.
Commuter towns & areas around Dublin.
 Recession: Huge fall in demand, oversupply of houses,
prices collapsed.
Factors that influence the price
paid for Land
Road building:
 New roads being built (dual carriageways, etc) use
large amounts of land which in turn pushes up the
prices of available land. Access to urban areas.
Factors that influence the price
paid for Land
Business Demand:
 Demand for offices and businesses has pushed up the
price of land near urban areas in boom.
 Recession: Many vacant businesses/offices
Factors that influence the price
paid for Land
Public Amenities:
 As the number of housing estates increased so did the
demand for parks, green areas & sporting sites.
Now it’s your turn...
Think, Pair, Share
 Think on your own first and write down some of the
factors that need to be considered before deciding
where to locate a factory .
1 minute
 Then turn to their neighbour (pairs) and discuss
some of the key points and see if you can come up
with any more ideas.
2 minutes
 Feedback your ideas to the class
Factors that need to be considered
before deciding where to locate a
factory
 Labour and Wage Rates
 Cost of Land
 Nature of the product manufactured
 Availability of infrastructure
 Government subsidies
Now its your turn!!
 In groups of 3
 Using Paper provided
 Expand on each of the area listed above with regard
to the factors that need to be considered before
deciding where to locate a factory.
 You have 4 minutes to do this
 You must elect a spokesperson, writer and timekeeper
for each group
Factors that need to be considered
before deciding where to locate a
factory
Labour & Wages Rates:
 Availability of local, suitably qualified labour supply is
essential.
 Minimum wage rate and wages rates in general can be
a deciding issue
Factors that need to be considered
before deciding where to locate a
factory
Cost of Land:
 Influence the choice of factory site.
 Urban sites generally cost more than agricultural ones.
Factors that need to be considered before
deciding where to locate a factory
Nature of product Manufactured:
 Weight losing: The raw material used is more bulky
than the finished good therefore will tend to locate
close to the source of the raw materials.
 Weight gaining: Finished product is more fragile or
perishable than the raw materials used in the
production process. Locate near their market e.g.
bakeries.
 Footloose: Industry that has relatively low transport
cost e.g. ebooks
Factors that need to be considered
before deciding where to locate a
factory
Availability of Infrastructure:
 Water and Power supplies.
 A good road system needed for transport of staff and
raw materials to and from the business.
 Good telecommunications
Factors that need to be considered
before deciding where to locate a
factory
Government influence:
 Government may provide grants and subsidies for
locating in disadvantaged areas e.g. tax relief
Labour
Labour:
 Factor of producution
 the human activity directed towards the
production of wealth.
Demand for Labour
Demand for Labour: Derived Demand
 Labour is demanded for its contribution to the
production process or from the demand for the goods
it produces.
 The price of labour is determined by demand and
supply.
***The demand for any factor of production is its
Marginal Revenue Product (MRP) curve***