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If the labor supply curve is given by w= 2 + 5L +.05L demonstrate that the marginal expense of labor is always above labor su
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Labor Supply curve is given by :

Labor Supply (w) = 2 + 5L + 0.5L2

Marginal Expense of Labor = d(wL)/dL = d(L(2 + 5L + 0.5L2))/dL = 2 + 10L + 3*0.5L2 = 2 + 10L + 1.5L2

Thus for any L , Marginal Expense of Labor \geq Labor Supply(w)

Hence, Marginal Expense of Labor is always above Labor Supply.

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