Explain why a monopsonist's marginal labor cost curve must lie above its labor supply curve
The labor supply curve shows the wage rate needed to hire each additional unit of labor. For a
monopsonist, when it offers higher wages to attract additional units of labor, it must also pay the higher
wage to all other workers. Therefore, the change in total labor cost rises even faster than the wage rate, and
hence the MLC curve will lie above the labor supply curve.
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Which of the following statements identifies the difference between variable costs and fixed costs?
A) Variable costs are the costs incurred on variable factors of production, whereas fixed costs are the costs incurred on all factors of production. B) Variable costs of a firm are zero after it shut downs, whereas it continues to incur the fixed costs of production in the short run. C) Variable costs exist even when the production is zero, whereas fixed costs exist only when there is some positive production. D) Variable costs are incurred only in the long run, whereas a firm incurs some fixed costs in both the short run and the long run.
Agricultural extension refers to
a. increasing the amount of land on which crops are grown b. helping farmers understand and use new techniques c. increasing the number of workers on the land d. increasing the range of inputs used by farmers e. none of the above