Calculate the equilibrium number of units of labour

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Labour Demand with Monopsony in the Labour Market and Monopoly in the Output Market in Short Run.

You are the manager of a business that operates as a Monopolist in the output market, and it is a Monopsonist in the local labour market.

The production function of the business is given by: Q = ΩL

As a Monopolist, the firm faces a market demand given by: P = α - βQ

As a Monopsonist the firm faces a supply of labour given by the expression: w = μL

a) Calculate the equilibrium number of units of labour employed in short run.

b) Briefly discuss the advantages for a firm of being a Monopolist in the output Market and a Monopsonist in the Labour Market.

Reference no: EM132489485

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