A Firm That Is a Monopolist in the Output Market

question 79

Multiple Choice

A firm that is a monopolist in the output market and a monopsonist in the input market

• A) will hire the same amount of labor as if perfect competition prevailed in both markets, but pay a lower wage.
• B) will restrict the level of output but not that of employment compared to the perfectly competitive case.
• C) will hire less labor but pay the same wage compared to the perfectly competitive case.
• D) will hire less labor and pay a lower wage compared to the perfectly competitive case.

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Definitions:

Caregivers

Individuals who provide care and support to family members, friends, or patients who are unable to look after themselves due to illness, disability, or age.

Physically Disabled

Individuals with limitations on their physical functioning, mobility, dexterity, or stamina.

Federal Employment Taxes

Taxes imposed by the federal government on employers and employees, including income tax withholding, Social Security, and Medicare taxes.

Federal Tax Deposit Schedule

The timetable set by the IRS for businesses to deposit employee withheld taxes and FICA taxes.