Labor Markets and Monopsony Power The demand curve in the product market for a football team is given by: P(Q) = 200 Q where Q is the number of wins for the team and P is the price they can charge. There are 4 teams and each team has a monopoly in the product market. The production function for each team is given by: Q(`) = 2` where ` is the amount of 'talent' that the hire

Now suppose both the league and players' union have market power. The players have higher bargaining power than the league: their bargaining parameter is p = 3 5 . 15. If the union and the league negotiate a collective bargaining agreement, what is the equilibrium amount of talent hired?

16. If the union and the league negotiate a collective bargaining agreement, what is the wage such that the teams get all the surplus?

17. If the union and the league negotiate a collective bargaining agreement, what is the wage such that the players get all the surplus?

18. If the union and the league negotiate a collective bargaining agreement, what is the equilibrium wage?

19. If the union and the league negotiate a collective bargaining agreement, what is the total surplus for teams?

20. If the union and the league negotiate a collective bargaining agreement, what is the total surplus for players?