Basic concepts
This market structure has many buyers and many sellers.
Perfect competition
A monopolist faces this type of demand curve
downward-sloping demand curve
A monopsony has market power over this group.
workers
Both monopoly and monopsony are examples of this.
market power
A monopoly exists when there is only one ____ in a market.
seller
This barrier to entry comes from owning a critical resource.
resource ownership
In a monopsony, wages tend to be ____ compared to competitive markets.
lower
A monopoly controls price in the output market, while a monopsony controls price in this market.
the input or labor market
A monopsony exists when there is only one ____ in a market.
buyer
When a monopolist charges different prices to different consumers, it is called this.
price discrimination
This curve represents the cost of hiring one more worker in a monopsony.
marginal factor cost (MFC) curve
Monopolies restrict output, while monopsonies restrict this.
employment
This type of firm is a price maker rather than a price taker.
monopoly
This rule describes how a monopolist maximizes profit.
MR = MC
A monopsonist hires workers where this equals marginal revenue product.
marginal factor cost
Both structures can lead to this economic inefficiency.
deadweight loss
This market structure is often associated with labor markets where one firm dominates hiring.
monopsony
This loss of total surplus occurs when monopolies restrict output.
deadweight loss
This policy can sometimes increase employment in a monopsony labor market.
a minimum wage
This key difference separates monopoly from monopsony.
whether the firm is a buyer or a seller