The Monopsonist's Marginal Input Cost Is Greater Than Its Average

question 56

Multiple Choice

The monopsonist's marginal input cost is greater than its average input cost because:

• A)the firm must increase the price it is willing to pay,to increase employment of an input.
• B)the monopsonist does not have discretion over the price of the input.
• C)the marginal revenue product of labor increases as the number of workers hired increases.
• D)the monopsonist faces a downward-sloping input demand curve.

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Definitions:

Z-score

A calculation that determines how a particular value's distance from the mean of a set of values is expressed in standard deviations.

Outlier

An observation in data that is significantly different from the majority of the data, potentially due to variability in the measurement or an experimental error.

Median

The middle value in a data set, when the values are arranged in ascending or descending order, or the average of the two middle numbers when the dataset has an even number of observations.

Third Quartile

The value below which 75% of the data in a data set lie, representing the upper quartile of a distribution.