For a Monopsonist, the Marginal Factor Cost Curve Will Be

question 224

Multiple Choice

For a monopsonist, the marginal factor cost curve will be above the supply of labor curve. The marginal factor cost curve is above the supply curve because

• A) the monopsonist will take advantage of labor and offer them lower wages.
• B) in order for the monopsonist to sell an additional unit of the good, the price of the good must be lowered.
• C) in order for the monopsonist to hire more labor the monopsonist must also purchase more capital.
• D) the monopsonist will have to pay all workers a higher wage rate than the current wage rate if it wants to hire more workers.

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