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Old 08-04-2011, 11:13 AM   #338
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monopsony (DO)<br />The sole buyer in a particular market. In product markets, public authorities are the major examples, e.g. the UK's National Health Service; in labour markets, any large firm employing a large proportion of the industry's workforce. As a monopsonist faces an upward-sloping factor supply curve, its MARGINAL cosT curve is above its average cost curve. Monopsonistic firms employ fewer workers at lower wages than competitive firms, if they are PROFIT MAXIMIZERS.
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