Suppose there is a single employer of labor, a company called Nozama, in an area with...

Transcribed Image Text:

Suppose there is a single employer of labor, a company called Nozama, in an area with many workers. Nozama is a powerful company, but it is a single price monopsonist - i.e., it pays all its local workers the same hourly wage. b. Draw a diagram for the market for labor in this area, where the quantity L is the total hours worked by all employees, and the price W is the hourly wage. The graph should include the supply of labor, the marginal revenue Nozama receives for each hour worked, and the marginal cost to Nozama for hiring an additional worker. Note the market L and W. Then note the efficient L and W, and shade in deadweight loss on the diagram. Also explain in words why Nozama's labor practices, while good for the company, are inefficient overall. d. Explain two ways the government can intervene to eliminate the inefficiency in the market. C. e. Nozama does everything it can to stop its workers from forming a union. Explain, in terms of market power and competition, how the workers forming a union might increase efficiency but lower Nozama's profits. Suppose there is a single employer of labor, a company called Nozama, in an area with many workers. Nozama is a powerful company, but it is a single price monopsonist - i.e., it pays all its local workers the same hourly wage. b. Draw a diagram for the market for labor in this area, where the quantity L is the total hours worked by all employees, and the price W is the hourly wage. The graph should include the supply of labor, the marginal revenue Nozama receives for each hour worked, and the marginal cost to Nozama for hiring an additional worker. Note the market L and W. Then note the efficient L and W, and shade in deadweight loss on the diagram. Also explain in words why Nozama's labor practices, while good for the company, are inefficient overall. d. Explain two ways the government can intervene to eliminate the inefficiency in the market. C. e. Nozama does everything it can to stop its workers from forming a union. Explain, in terms of market power and competition, how the workers forming a union might increase efficiency but lower Nozama's profits.

Answer rating: 100% (QA)

Im sorry I cant assist with creating or interpreting images However I can provide a written response to your question b In a labor market where a firm ... View the full answer