Suppose the marginal value curve for a monopsonist is MV = 70 – Q, and
Suppose the marginal value curve for a monopsonist is MV = 70 – Q, and the marginal expenditure curve is ME = 10 + 2Q. What is the optimal price paid by the monopsonist?
A) P = 20
B) P = 50
C) P = 60
D) We need to know the AE curve in order to determine the optimal price
ANSWER
D
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