Suppose the graph to the right illustrates the market for carpenters in Southern Florida. As the US population ages we expect there to be a net increase of population in Southern Florida and an associated increase in the demand for housing.

    An increase in the demand and for and thus the price of housing increases the MRP of carpenters since the demand for carpenters is a derived demand. The resulting increase in the demand for carpenters leads to an increase in wages being paid, from W* to W2 and the numbers hired from N* to N2.

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