Economics:
10th Edition
ISBN: 9781285859460
Author: BOYES, William
Publisher: Cengage Learning
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Question
Chapter 29, Problem 9E
To determine
To explain:
The meaning of monopsonist and the difference between a monopsonist and a monopolist.
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On a clearly labeled graph, show what happens to wages paid and employment if the governmentimposes a payroll tax on a monopsonist?
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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?arrow_forwarda. What happens to wages and employment if the government imposes a payroll tax on a monopsonist? Compare the response in the monopsonistic market to the response that would have been observed in a competitive labor market.b. Suppose a firm is a perfectly discriminating monopsonist. The government imposes a minimum wage on this market. What happens to wages and employment?arrow_forwardA commodity has a demand of Q = 30 - P and a supply of Q = -4 + P. 1. draw a graph that shows the market equilibrium for each of the following cases: A. A competitive market B. A monopolist sells the product to consumers. C. A monopsonist purchases the product from producers. please label clearly all the curves that you draw and the prices and quantities for each of the three cases.arrow_forward
- Name the two types of markets where Monopsony is common. For each gives an example of a monopsony within that market type.arrow_forwardDraw a graph of a bilateral monopoly and explain how market wages are determined, thanks!arrow_forward(a) Explain why we might expect labor demand for a monopolist in the product market to be less elastic than labor demand under perfect competition ?arrow_forward
- 1. Use the graph to answer the question that follows. If the price is set to P1, what area represents the producer surplus in the graph shown above? D B + C + D C + D + F B + C + D + G B + C + D + E + F 2. The graph below represents the labor supply curve of a monopsonistic firm. What is the quantity of labor and the wage that will maximize the firm's profits? Firm's profits are maximized at quantity = Q1 and wage = W4 Firm's profits are maximized at quantity = Q2 and wage = W3 Firm's profits are maximized at quantity = Q2 and wage = W5 Firm's profits are maximized at quantity = Q3 and wage = W1 Firm's profits are maximized at quantity = Q1 and wage = W2arrow_forwardIn terms of which of the following is the monopoly greater than the competitive market? a) Prevalence b) The number of firms c)Market quantity d) Market power of a firm e) c and darrow_forwardFirm 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=.arrow_forward
- Is it inevitable that the monopoly price of a commodity must be higher than its competition price? whyarrow_forwardWhat is the right of subrogation? When does the right of subrogation arise?arrow_forwardIf 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 Falsearrow_forward
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