In order to hire additional laborers, a monopsony must
A. raise the wage rate.
B. lower the supply of labor.
C. advertise for the labor.
D. do nothing.
Answer: A
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The proposition of monetary neutrality states that changes in the money supply have:
A) no impact on output in the short run B) no impact on output in the long run C) no impact on the price level in the short run D) no impact on the price level in the long run
Why do people hold money (currency and checking account balances), and thereby forgo earning interest or dividends from a financial investment?
a. Some money is demanded for everyday transactions like parking fees, lunch, and buying groceries. b. Some money is demanded as a precaution against unexpected costs such as automobile repairs, speeding tickets, or temporary loss of a job. c. Some money is demanded for speculative purchases of stocks, bonds, or collectibles in case they become available at a particularly low price. d. All of the above are correct.
In the long run, a year-long drought that destroys most of the summer's wheat crops causes permanently:
A. higher prices. B. lower prices. C. lower output. D. None of these is true.
The way that a change in price determines whether or not consumers buy goods
a. elasticity of demand b. substitution effect c. law of demand d. complement e. substitute