Compared to a perfectly competitive firm,the monopsonist's marginal labour cost is __________,resulting in a __________ socially optimal level of output.

Question

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A monopsonist faces an upward-sloping labor supply curve, meaning it must pay higher wages to attract more workers. This results in a marginal labor cost that is greater than the wage rate, leading to a lower level of employment and output than is socially optimal.

Compared to a Perfectly Competitive Firm,the Monopsonist's Marginal Labour Cost