Refer to the labor market diagram where D is the labor demand curve, S is the labor supply curve, and MRC is the marginal resource (labor) cost curve. If an inclusive union was formed and was able to get the monopsonist to agree to a $7 wage rate, then the monopsonist would:
A. reduce employment from 5 to 3 workers.
B. reduce employment from 5 to 2 workers.
C. increase employment from 3 to 5 workers.
D. not alter its level of employment.
C. increase employment from 3 to 5 workers.
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The competitive firm's long-run supply curve
a. is always perfectly horizontal. b. includes only that part of the long-run marginal cost curve that lies above long-run average cost. c. includes only that part of the long-run marginal cost curve that is sloping upwards. d. is identical to its long-run average cost curve.
The length of the short run is the same for all firms
Indicate whether the statement is true or false
John Maynard Keynes advocated policies that would increase aggregate demand as a way to decrease unemployment caused by recessions
a. True b. False Indicate whether the statement is true or false
The risk premium is the
A. Interest rate divided by the expected value. B. Interest rate charged to borrowers. C. Difference in rates of return on safe and risky investments. D. Interest rate paid to savers.