Suppose Your Firm Is a Monopsonist Hiring Only One Variable

question 74

Multiple Choice

Suppose your firm is a monopsonist hiring only one variable input.If you want to maximize profits,you will purchase that variable input up to the point where the

• A)demand curve intersects the supply curve of the input.
• B)MRP curve for the input intersects the marginal cost curve for the input.
• C)wage rate is the highest.
• D)marginal product of that input equals the price of one unit of the input.
• E)cost of the input equals the profit generated by the employment of that input.

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Definitions:

Exercise Price

The price at which an option holder can buy (call option) or sell (put option) the underlying asset or security by a predetermined date.

Ordinary Shares

Equity securities representing ownership in a company, giving shareholders voting rights and a share in the company's profits.

IPO

Initial Public Offering, the process through which a private company becomes publicly traded by offering its shares to the public for the first time.

Initial Public Offering

The first sale of stock by a private company to the public, often used by companies to raise capital for expansion.