Profit maximizing level of labor

Reference no: EM1311274

1. The supply curve for labor is S_L = 100W, where W is the market wage. The marginal revenue product curve for the firm is D_L = -50W + 450.

(a) If the firm is a monopsonist, how many workers will it hire in order to maximize profits? What will be the wage?
(b) If the supply of labor is monopolized, how many workers are supplied in order to maximize the wage bill? What is that wage?

Reference no: EM1311274

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