Questions: Question 22 2 pts When an employer is exploiting its market power, we call the firm a: monopoly monopsony price maker price discriminator

The answer is the second one (B): monopsony.

Explanation for each option:

A. Monopoly: This term refers to a market structure where there is only one seller or producer that controls the entire supply of a product or service, and thus can influence prices. It is not related to an employer exploiting market power in the context of hiring.

B. Monopsony: This is the correct answer. A monopsony occurs when there is only one buyer in a market, giving that buyer significant power over suppliers or workers. In the context of employment, a monopsony refers to a situation where a single employer has significant control over the labor market, allowing it to exploit its market power by setting wages and employment conditions.

C. Price maker: This term refers to a firm that has the power to influence the price of the goods or services it sells, typically due to a lack of competition. While related to market power, it does not specifically address the employer-employee relationship.

D. Price discriminator: This term refers to a firm that charges different prices to different consumers for the same product, based on their willingness to pay. It is not directly related to an employer exploiting market power in the labor market.

In summary, when an employer is exploiting its market power, the firm is considered a monopsony.