In Monopsony, If the Wage Is Determined for the Quantity

question 59

Multiple Choice

In monopsony, if the wage is determined for the quantity of factor input where MRP = MFC, a minimum wage established above the monopsony wage, but below where the competitive wage would be, will:

• A) lead to more unemployment.
• B) lead to lower employment.
• C) lead to higher employment.
• D) lower wages.

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Definitions:

Markup

The amount added to the cost price of goods to cover overhead and profit; it calculates the selling price.

Manufacturing Overhead

All indirect costs associated with manufacturing, excluding direct materials and direct labor, such as maintenance, depreciation, and utilities.

Predetermined Overhead Rate

A rate calculated before a period begins, based on the estimated total manufacturing overhead costs and estimated allocation base, used to allocate overhead to products or job orders.

Manufacturing Departments

Specialized sections within a manufacturing facility responsible for different stages of product production, such as assembly, finishing, or quality control.