If an industry is monopolized, then Labour Demand will be below the Labour Demand under competition. However, if the firm is also a monopsonist than labour demand can be either larger or smaller than under competition. True False A natural monopoly occurs when a firm gains ownership of the entire stock of some natural resource and thus is able to exclude other producers. True False

If an industry is monopolized, then Labour Demand will be below the Labour Demand under competition. However, if the firm is also a monopsonist than labour demand can be either larger or smaller than under competition. True False A natural monopoly occurs when a firm gains ownership of the entire stock of some natural resource and thus is able to exclude other producers. True False

Economics For Today

10th Edition

ISBN:9781337613040

Author:Tucker

Publisher:Tucker

Chapter11: Labor Markets

Section: Chapter Questions

Problem 19SQ

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Table 14.13 shows information from the supply curve for labor for a monopsonist, that is, the wage rate required at each level of employment. What is the monopsonists marginal cost of labor at each level of employment? If each unit of labors marginal revenue product is 13, what is the firms profit maximizing level of employment and wage?
If an industry is monopolized, then Labour Demand will be below the Labour Demand under competition. However, if the firm is also a monopsonist than labour demand can be either larger or smaller than under competition. True or False
The inverse labour demand curve of a monopsonist employer is W = 41,500 – 101L, where W is the annual salary and L is the number of workers hired. The labor supply is given by W = 9,800 + 109L. (a) The marginal expenditure equation is ME=__________ (b) To the nearest integer, the monopsonist would hire ______ workers and, given that number of workers, the salary they would pay is, rounded to 2 decimal places (e.g. 4.12) ____
Question 4 True/False: The supply curve for labor that a monopsonist faces is the supply curve for the industry. Group of answer choices True False
The more elastic the labour supply is, the smaller the wage paid by a monopsonist. True or False?
Under monopsony, the interaction of supply and demand determines wages and number of workers employed. True False
True or false. When a labor market consists of a single monopsony buyer of labor interacting with a single monopoly seller of labor (such as a trade union), the resulting quantity of labor that is hired will always be inefficiently low.
The monopsonist will hire 50 units of labor at a wage rate of w = L = 50. In comparison to a perfectly competitive employer who hires 50 units of labor at a wage rate of 100, the monopsonist hires half the quantity of labor at half the wage rate. Hence, the statement is true.
Assume a firm is a monopsonist that can hire its first worker for $6 but must increase the wage rate by $3 to attract each successive worker. Draw the firm’s labor supply and marginal resource cost curves and explain their relationships to one another. On the same graph, plot the labor demand data of question 2. What are the equilibrium wage rate and level of employment? Why do these differ from your answer to question 9?
Firm Alpha is a monopsonist in the labor market. The firm’s marginal value of labor is MVL = 105 - 3L. The labor supply is LS = 0.5w. The monopsonist uses its market power to maximize its own profit. The monopsonist hires L= workers and pays a wage w=. The deadweight loss in this market is DWL=.
Bridge Coal Company is the only employer in a remote and mountainous region of the country, so the firm is the monopsony buyer of labour in the market. If the price of coal increases, then the firm's: A. AE curve shifts leftward. B. AE curve shifts rightward. C. ME and AE curves shift rightward. D. ME curve shifts leftward. E. MV curve shifts rightward.
If the sole employer in a market is a monopsonist, the equilibrium number of workers hired will be ___ and the equilibrium wage will be ___ than they would be in a perfectly competitive market. a.Higher; higher b.Lower; higher c.Higher; lower d.Lower; lower