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The Supply of Labour to a Monopsonistic Firm Is W

Question 24

Multiple Choice

The supply of labour to a monopsonistic firm is w = 10 + z, where w is the wage rate and z is quantity of labour. The firm's MRP = 70 - z. The firm employs only labour. The minimum wage which will induce the firm to hire the largest number of workers is:


A) $45.
B) $40.
C) $35.
D) $50.

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