need 8-11 Ryan Tatler A. Determine the following using diagram to answer the following questions. This assignment is about the choices that a monopsonist firm is expected to make. A monopsonist firm is a single buyer of a set of inputs, in this case the input is labor with athletic skills and the firm is a professional sport team
1. The quantity labor employed by the firm (alb) Explain why: Because on the last unit of labor employed
2. The wage paid by the firm (w)
Explain why:
0.5 m/year
30 labor/yer MFL = MRP
Because we is when supply curve = Equilibrium Prin
3. the wage bill (or labor costs) to the firm =
$115
4. explain why: 4*w: 30(£)
51420/414
Wage, MFC, MRP, ARP, VMP
5. the total revenue to the firm =
Explain why
TR-ARQ: bo) (1.4)
6. the allocative efficient or socially
Optimal quantity= 3.
Explain why
Because on this last unit, if employed. VMP W
7. the dead weight loss =
2(1-0.5) (36-12)=765
8. The "exploited value" =
$1.5m/person/yr
Sim/person/yr
5.5 m/person/yr
0
12 people/year 24 people/year 36 people/year Because the firm pays
qlabor
but MRPlabor-St/person
9. Name the unnamed curves (do not abbreviate), write the entire name
Marginal
a.
b.
Marginal
C.
Average
Staber
10. State the condition that explains the following
O
.
diminishing MRP labor: An economic principle called The law of diminishing MPlabor [since MRPlabor = MP labor XMR product and MR product is assumed to be constant, if hires more of this input, and MP labor diminishes, then MRP labor has to diminish
diminishing ARP labor: A mathematical principle that states if the firm uses a large quantity of this input and then ARP input will diminish
MRP input profit maximizing (loss minimizing) quantity of labor for a firm to employ: an economic principle that states if on the last unit of labor employed MRP labor MFClabor, the firm is employing a profit maximizing or loss minimizing quantity of labor
Allocative efficient or socially optimal quantity of labor for the firm to employ: an economic principle that state if on the last unit of labor employed, Value of the Marginal Product of labor = w, then the quantity employed is an allocative efficient or socially optimal quantity of labor to employ
11. List market reasons for wage differentials (Look them up in the lectures)
a. Differences in amount and quality of Education of different individuals
b. Differences in
e. Differences in