A monopsonist:
A. faces a downward-sloping demand curve and by lowering the quantity he sells, he can charge more.
B. faces a horizontal demand curve and by raising price, he will lose all of his consumers.
C. faces an upward-sloping supply curve and by lowering the quantity he buys, he can pay less.
D. faces a downward-sloping supply curve and by increasing the quantity he buys, he can pay less.
C. faces an upward-sloping supply curve and by lowering the quantity he buys, he can pay less.
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Using the figure above, suppose education is provided by public colleges. At what level should tuition be set to ensure the efficient number of students?
A) $10,000 B) $5,000 C) $20,000 D) $25,000 E) $15,000
When applying for a loan, a borrower tends to know more about her ability to pay it back than does the bank. This is an example of
a. perfect information b. moral hazard c. a low marginal benefit of information for the bank d. asymmetric information e. optimal search
In order to be successful in a market economy, entrepreneurs must
a. combine resources in a manner that increases their value. b. produce a good that consumers value less than the resources used to produce it. c. use only personal financial capital so they can avoid interest payments on borrowed funds. d. produce anything that consumers value, regardless of cost.
A public utility is a classic example of:
A. a natural monopoly. B. perfect competition. C. an oligopoly. D. monopolistic competition.