Use the figure below to answer the following questions. Figure 17.3.1
-Refer to Figure 17.3.1.This figure shows the value of marginal product of labour curve,the labour supply curve,and the marginal cost of labour curve.If this labour market is controlled by a monopsony,the wage rate is

Question

Use the figure below to answer the following questions.  Figure 17.3.1
-Refer to Figure 17.3.1.This figure shows the value of marginal product of labour curve,the labour supply curve,and the marginal cost of labour curve.If this labour market is controlled by a monopsony,the wage rate is

Quizplus · Accepted Answer

In a monopsony, the marginal cost of labor (MCL) curve lies above the labor supply curve, which means that the monopsonist has to pay a higher wage rate to hire more workers. The wage rate at the point of intersection between MCL and marginal product of labor (MPL) curves gives the optimal wage rate. In this case, the wage rate at that intersection is approximately $11 an hour. Therefore, the answer is D.

Use the Figure Below to Answer the Following Questions