Monopsony profit is the difference between a worker's MRP and the MCL.

Name: Monopsony profit is the difference between a worker's MRP and the MCL.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Monopsony profit occurs when a firm with market power in the labor market pays workers less than their marginal revenue product (MRP) which is the additional revenue generated by hiring an additional worker. Monopsony profit is the difference between the MRP and the firm's marginal cost of labor (MCL). Therefore, the statement is true.

Monopsony Profit Is the Difference Between a Worker's MRP and the MCL