Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
To reduce the number of job applicants
B
To increase the supply of labor available
C
To comply with government regulations
D
To maintain a fixed wage level
Understanding the Answer
Let's break down why this is correct
Answer
A monopsony employer is a company that is the only buyer of labor in a specific market, meaning it has a lot of control over wages. When this employer raises wages, the main reason is to attract more workers because they need more employees to meet their business needs. By offering higher pay, the employer can draw in job seekers who might otherwise choose to work elsewhere or not work at all. For example, if a small town has only one factory that pays low wages, increasing the pay can help the factory fill open positions, ensuring it has enough workers to operate efficiently. This strategy not only helps the employer but also improves job opportunities for workers in that area.
Detailed Explanation
When a monopsony employer raises wages, they want to attract more workers. Other options are incorrect because Some might think that raising wages would scare away applicants; It's a common belief that employers raise wages just to follow rules.
Key Concepts
Monopsony in Labor Markets
Wage Determination
Labor Supply
Topic
Monopsony in Labor Markets
Difficulty
easy level question
Cognitive Level
understand
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