Chapter 25 Demand for Resources (Chapter 26 contains Monopsony)
Labor demand introduction and here and here. Cost minimizing using MP/dollar here.Practice tests and more here.
The competitive wage and monopsony wage, respectively, are what levels of W?
W2 and W1.
In a competitive market, the wage is determined by the intersection of market supply and market demand: Q3 workers are hired at a wage of W2. A monopsony maximizes profits by equating the marginal resource cost (MRC in the diagram) with marginal revenue product (D in the diagram), so hires Q2 workers. In order to attract Q2 workers it need only pay a wage of W1.
W2 and W1.
In a competitive market, the wage is determined by the intersection of market supply and market demand: Q3 workers are hired at a wage of W2. A monopsony maximizes profits by equating the marginal resource cost (MRC in the diagram) with marginal revenue product (D in the diagram), so hires Q2 workers. In order to attract Q2 workers it need only pay a wage of W1.
factor_markets.ppt | |
File Size: | 294 kb |
File Type: | ppt |
factors_markets_part_ii.ppt | |
File Size: | 253 kb |
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least_cost_hiring.ppt | |
File Size: | 517 kb |
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chap012.ppt | |
File Size: | 588 kb |
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competitive_vs_market_power_firms.ppt | |
File Size: | 529 kb |
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monopsony.ppt | |
File Size: | 227 kb |
File Type: | ppt |
Chapter 28 Government and Market Failure
public_goods__taxes.ppt | |
File Size: | 846 kb |
File Type: | ppt |
apeconch28public_v_private_goods.ppt | |
File Size: | 234 kb |
File Type: | ppt |
Practice tests and more here.
At the equilibrium price and quantity, consumer surplus in this market is:
the area below the demand curve but above the price. The area in this example is equal to ½ x ($8 – $5) x 100, or $150.
the area below the demand curve but above the price. The area in this example is equal to ½ x ($8 – $5) x 100, or $150.