Two members of the Kenyan parliament from coffee-growing areas said that no firm should have a monopoly to market Kenyan coffee. The retail coffee company Tetu Coffee has sparked a storm in the industry by promising to earn the country Sh400 (Kenyan Shilling) billion annually if given exclusive licenses to market Kenyan coffee. The members of parliament said the coffee bean farmers should be free to sell their beans to the highest bidder. If all coffee growers had to sell their produce to Tetu Coffee, this would be a(n):

Question

Quizplus · Accepted Answer

A monopsony occurs when there is only one buyer for a product or service. If all coffee growers were required to sell their beans exclusively to Tetu Coffee, Tetu Coffee would be the sole buyer, creating a monopsony situation.

Two Members of the Kenyan Parliament from Coffee-Growing Areas Said