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Suppose the labor market for nurses in Heber Springs in Arkansas is very limited, effectively functioning as a monopsony with the local hospital as the
Suppose the labor market for nurses in Heber Springs in Arkansas is very limited, effectively functioning as a monopsony with the local hospital as the only employer of nurses. Graphically show this market. How would the hospital price the labor (wage) of nurses? How would the hospital determine how many nurses to hire? Would this market have any deadweight loss? Is there any option to minimize the deadweight loss (if it exists) in this market?
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