A Monopsony Has an Upward Sloping Supply Curve Because

question 173

Multiple Choice

A monopsony has an upward sloping supply curve because

• A) diminishing marginal product to scale does not exist in a monopsony.
• B) each additional unit of labor costs less.
• C) when more units of labor are hired, all laborers must receive the higher wage.
• D) when more units of labor are hired, only the new workers receive the higher wage.

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Definitions:

Land Rent

Payment made for the use of land, typically based on its productivity, location, and the competitive demand for land use.

Acres

A unit of measurement used primarily in the U.S. to describe the size of land, equating to 43,560 square feet.

Economic Rents

Extra earnings or return above the normal expected return of an investment or economic activity.

Reallocation

The process of redistributing resources or assets from less productive uses to more productive ones in order to enhance efficiency and economic output.