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-If There Is a Monopsony Operating in the Labor Market

Question 111

Multiple Choice

-If there is a monopsony operating in the labor market illustrated in the figure above and the federal government decides to institute a minimum wage of $8 an hour then the wage paid will ________ and the quantity of labor hired will ________. A) increase; decrease B) increase; increase C) decrease; increase D) decrease; decrease
-If there is a monopsony operating in the labor market illustrated in the figure above and the federal government decides to institute a minimum wage of $8 an hour then the wage paid will ________ and the quantity of labor hired will ________.


A) increase; decrease
B) increase; increase
C) decrease; increase
D) decrease; decrease

Correct Answer:

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