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Question
Scenario 14.4:John's firm is a competitor in your product market and a monopsonist in the labor market. The current market price of the product that your firm produces is $2. The total product and marginal product of labor are given as:
TP = 100L - 0.125L2 MP = 100 - 0.25L
where L is the amount of labor employed. The supply curve for labor and the marginal expenditure curve for labor are given as follows:
L = PL -5 MEL = 2L + 5
Refer to Scenario 14.4. How much will the monopsonist pay each worker?
A) 0
B) 78
C) 83
D) 92
E) 100
Answer
This answer is hidden. It contains 1 characters.
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