The Figure Given Below Represents Equilibrium in the Labor Market

The figure given below represents equilibrium in the labor market.Figure 14.5
In the figure,
VMP: Value of marginal product curve
MRP: Marginal revenue product curve
MFC: Marginal factor cost
S: Supply curve of labor

-In Figure 14.5, the firm is:

A) a monopsonist in the labor market and a perfect competitor in the output market.
B) a monopsonist in the labor market and a monopolist in the output market.
C) a perfect competitor in all markets.
D) a perfect competitor in the labor market and a monopolist in the output market.
E) either a monopolist or a monopsonist, but not both.

Correct Answer:

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