(2) the productivity of the resource (3) the number of buyers of the resource and (4) the price of related resources. Changes in the output price - The MRPL is the MPL × the output price thus if the price of the output increases due to an increase in demand for the product the value of the marginal product of labor increases at every price and the resource demand curve shifts out. For example, if the price of the output increases firms will react by producing more to meet the demand and that will cause the demand for the inputs to increase. Changes in productivity - Productivity changes affect the resource demand in several ways. Technological changes increase the marginal product of labor which makes labor more valuable and causes the demand curve to shift out. The quantity of other resources can affect productivity. The more machines labor has to work with the greater the marginal product of labor which will cause the resource demand curve to shift out. The quality of the resource is an important factor in determining the value of labor as a resource. For example, a highly educated and experienced labor force is generally more productive. Conversely, technological changes also could lead to the reduction of the demand of labour. The invention of cheap industrial robots, for example, may reduce the marginal production of labour, shifting the labour demand curve to the left. This phenomenon is known as labour-saving technological change. However, technological improvement is still primarily labour-augmenting. Changes in the number of buyers of the resource - As with any market, additional buyers will cause the demand curve to shift out. Changes in the price of related resources - Related resources include complementary and substitute resources. A change in the price of a related resource will affect the demand for labor. For example, automobiles can be assembled with varying combinations of labor and machinery. If the price of machinery falls firms will tend to substitute machines for labor and the demand for labor will fall. If labor and machinery are used as complementary resources and the price of machinery falls then more machinery will be bought and more workers will be needed to run the new machines, causing the labor demand curve to shift out. Price elasticity of resource demand (PERD) As with the product market, a manager must not only know the direction of