Monopolization of the labor market restricts output because
A) fewer workers offer their services.
B) the higher wage raises the firm's marginal cost.
C) monopolized workers are less productive.
D) a monopolized labor market means there is also a monopolized output market.

Question

Quizplus · Accepted Answer

A monopolized labor market can lead to higher wages, which in turn increases the firm's marginal cost of production. This can cause the firm to reduce output to maintain profit margins.

Monopolization of the Labor Market Restricts Output Because