Which of the following scenarios best illustrates a monopsony in the labor market, highlighting the advantages for buyers compared to a monopoly situation?

A monopsony in the labor market occurs when there is only one major employer in a region or industry, giving that employer significant power over wages and hiring conditions. For example, imagine a small town where the only factory is owned by one company, and most workers rely on it for jobs. This company can pay lower wages than if there were many competing employers because workers have few other options for employment. In contrast, a monopoly situation involves a single seller controlling the market for a product, which can lead to higher prices for consumers. In a monopsony, the employer can benefit from lower labor costs, while workers may have fewer choices and lower pay compared to a competitive labor market.