In a monopsonistic labor market, how does the employer determine the wage level for workers, considering the effects of imperfect competition?

In a monopsonistic labor market, there is only one employer for many workers, which gives the employer significant power over wage levels. The employer determines the wage by considering how much they are willing to pay for labor while also thinking about how many workers they want to hire. Since there is no competition from other employers, the monopsonist can set wages lower than in a competitive market because workers have fewer job options. For example, if a company is the only factory in a small town, it might offer a wage of $10 per hour instead of the $15 per hour that would be offered if multiple factories were competing for workers. This situation can lead to lower overall wages and fewer job opportunities, affecting the workers’ income and well-being.