Suppose that the supply curve for the labor to a firm is given by

L = 100w

and the marginal expense of labor curve is given by

MEL = L/50

Where w is the market wage. Suppose also that the firm's demand for labor (marginal revenue product) curve is given by

L = 1,000 – 100MRPL

a. If the firm acts as a monopolist, how many workers will it hire in order to maximize profits? What wage will it pay? How will this wage compare to the MRPL at this employment level?

b. Assume now that the firm must hire its workers in a perfectly competitive labor market, but it still acts as a monopoly when selling its output. How many workers will the firm hire now? What wage will it pay?

c. Graph your results.