All of the following are true for a monopsonist except
A)The marginal factor cost for labor exceeds the wage rate.
B)The demand for labor is the same as the marginal revenue product of labor.
C)The derived demand for labor is downward-sloping.
D)The market demand for labor is upward-sloping.

Question

Quizplus · Accepted Answer

The market demand for labor is not upward-sloping for a monopsonist, as they are the sole buyer of labor in the market and have market power to set the wage rate below the competitive equilibrium level. Instead, the monopsonist's demand for labor is downward-sloping. The other statements are true for a monopsonist.

All of the Following Are True for a Monopsonist Except