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Company Towns Are Often Decried as Monopsonists

Question 60

Multiple Choice

Company towns are often decried as monopsonists.Why was it unlikely that another employer would move into a company town?


A) The marginal workers available in the company town had low marginal revenue product.
B) The existing monopsonist had a first-mover advantage.
C) The marginal workers available in the company town would demand a wage higher than that obtained at the existing monopsonist.
D) Any of the above.

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