Which of the following is TRUE concerning equilibrium in a monopsonistic factor market?
A) The firm uses the efficient level of the input but does not maximize profit.
B) The firm maximizes profit but does not use the efficient level of the input.
C) The firm maximizes profit and uses the efficient level of the input.
D) The firm either maximizes profit or uses the efficient level of the input, but it cannot do both at the same time.
B
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As shown in the figure above, the rent ceiling
A) decreases consumer surplus. B) increases producer surplus. C) decreases deadweight loss. D) increases the quantity of housing rented. E) is efficient.
If the economic growth rate SLOWS from 5% to 1%, the simple accelerator hypothesis suggests that
A) investment will continue to rise as output increases. B) investment will fall as output increases. C) investment will accelerate since output growth is positive. D) None of the above is correct.