Assume the Ajax Mining Company hires 80 percent of the nonunion labor force of Mother Lode,New Mexico.Also,suppose that this labor force is highly immobile.Economists would describe this employer as a:

Question

Quizplus · Accepted Answer

A monopsonist is a firm that is the sole buyer of a particular good or service in a market, which is the case in this scenario as 80 percent of the nonunion labor force is hired by the Ajax Mining Company. This gives the firm significant market power and the ability to influence wages and working conditions in the labor market. The high immobility of the labor force further strengthens the firm's monopsony power as workers have limited options for employment.

Assume the Ajax Mining Company Hires 80 Percent of the Nonunion