Suppose the formerly competing firms in question 3 form an employers association that hires labor as a

Question:

Suppose the formerly competing firms in question 3 form an employers’ association that hires labor as a monopsonist would. Describe verbally the effect on wage rates and employment. Adjust the graph you drew for question 3, showing the monopsonistic wage rate and employment level as W2 and Q2, respectively. Using this monopsony model, explain why hospital administrators sometimes complain about a “shortage” of nurses. How might such a shortage be corrected?