What is the final outcome for workers in a monopsony? Select one: a. Workers are paid...

What is the final outcome for workers in a monopsony?

Select one:

a. Workers are paid more and more workers are hired

b. Workers are paid more, and fewer workers are hired

c. Workers are paid less, and fewer workers are hired

d. Workers are paid less, and more workers are hired

Solutions

Expert Solution

The final outcome for workers in a monopsony is (C) workers are paid less,and fewer workers are hired.

The term monopsony refers to a existance of only one buyer and many sellers.

The buyer here is the monopsony employer who has market power in employing factors of production,mainly labour.When there is only one employer,he will have power in setting wages and choosing how many workers to employ.Example - a mining town,Supermarkets,Amazon.

Rahul Sunny answered 1 year ago

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