Consider a firm with the following labor-intensive production function, Q = f(L) = L. Let w be the hourly wage. Suppose the firm in question is a Monopolist in the output market, and faces an inverse demand curve of P = 12 Q. Now suppose the supply of labor is given by L = S(w) = w. The monopolist does not realize this, and treats w as fixed, so the demand for labor stays the same. Using the supply and demand for labor, what is the resulting equilibrium employment L^* and wage W^*.

Suppose now the Monopolist understands that it also is a Monopsonist in the labor market. In other words, the firm now knows that by changing the amount of labor it employs it changes the wage w according to the aforementioned labor supply curve. Redo the Monopoly problem in such a way that incorporates this awareness by the firm