If unlike a perfectly competitive market, a monopsonist has to pay a higher wage to attract...

If unlike a perfectly competitive market, a monopsonist has to pay a higher wage to attract more workers, why, other things being equal, will a monopsonist pay a lower

wage than a perfectly competitive employer?

Expert Solution

Rahul Sunny answered 1 year ago

11. Sources of monopoly power A monopoly, unlike a perfectly competitive firm, has some market power....

11. Sources of monopoly power A monopoly, unlike a perfectly competitive firm, has some market power. Thus, it can raise its price, within limits, without quantity demanded falling to zero. The main way monopolies retain their market power is through barriers to entry, which prevent other companies from entering monopolized markets and competing for customers. Consider the market for tanzanite. The mines for this blue-purple gemstone, found only in Tanzania, are owned by the local government. Given that no one...

Consider the perfectly competitive market for tertiary education. Research has found that countries with higher level...

Consider the perfectly competitive market for tertiary education. Research has found that countries with higher level of tertiary educated population have lower levels of crime. Draw the market demand and supply for tertiary education, labeling both the market outcome and the socially optimal outcome. Explain your graph. Is the market outcome and the socially optimal outcome the same? Explain your answer. If your answer in part (b) is no, explain two possible solutions for achieving the socially efficient outcome. However,...

Use the perfectly competitive model of wage determination (with a single labor market) to predict the...

Use the perfectly competitive model of wage determination (with a single labor market) to predict the e ects of repealing immigration laws (i.e., opening the borders to all immigrants) on the level of employment and the equilibrium wage in the United States. What is the e ect on unemployment once the labor market reaches the new equilbrium?

Suppose that a monopsonist is able to perfectly discriminate among workers and pay each her reservation...

Suppose that a monopsonist is able to perfectly discriminate among workers and pay each her reservation wage. Graphically illustrate equilibrium employment and wages for a perfectly-discriminating monopsonist. How do they compare to a firm which hires labor in a perfectly competitive market? Assume the firm has no monopoly power and sells output in a competitive market. (You will need to draw the diagram, photograph your diagram, email it to yourself, and copy-and-paste it into the space below. Please type the...

6. If a market is perfectly competitive, then:

Perfect CompetitionWork Sheet #96. If a market is perfectly competitive, then: a. the market demand curve for the product is horizontal. b. the demand curve facing each individual seller is downward sloping. c. the demand curve facing sellers as a group and each individual seller is horizontal. d. the demand curve facing an individual seller is horizontal.7. Which of the following is characteristic of a purely competitive seller's (price taker's) demandcurve? a. It is the same as the market demand...

In a perfectly competitive market, each of the 10 consumers in in the market has demand...

In a perfectly competitive market, each of the 10 consumers in in the market has demand characterized by P(q)=MWTP(q)=100 - 5.7*q. If 100 units are transacted, what is the market price?

Consider the monopolistically competitive market structure, which has some features of a perfectly competitive market and...

Consider the monopolistically competitive market structure, which has some features of a perfectly competitive market and some features of a monopoly. Complete the following table by indicating whether each attribute characterizes a perfectly competitive market, a monopolistically competitive market, both, or neither. Check all that apply. Attributes Perfectly Competitive Market Monopolistically Competitive Market Many sellers Easy entry Few sellers Price equals average total cost in the long run

In a perfectly competitive market structure, a competitive firm has the given price as a price...

In a perfectly competitive market structure, a competitive firm has the given price as a price taker and, therefore, its price is equal to its MR shown on the same demand curve as the perfectly elastic demand curve. On the other hand, a monopoly firm has a downward sloping demand curve and its equilibrium price is always larger than MR (P>MR). Briefly explain why? Use both equation and diagram.

Suppose there is a perfectly competitive market for curry puffs. The perfectly competitive equilibrium price in...

Suppose there is a perfectly competitive market for curry puffs. The perfectly competitive equilibrium price in this market is RM5 per puff. The perfectly competitive equilibrium quantity is 5,000 curry puffs. (a) Using a diagram, illustrate the perfectly competitive equilibrium in the market for curry puffs. Clearly label the areas of consumer surplus, producer surplus, and social surplus at this equilibrium. [3 marks] (b) Suppose that the government introduces a price floor for curry puffs at RM7 each. Note: Use...

Describe the characteristics of a perfectly competitive market and a monopolistically competitive market? How are they...

Describe the characteristics of a perfectly competitive market and a monopolistically competitive market? How are they similar? How are they different?

Question