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FrozenT [24]
3 years ago
13

Yani just graduated from college and moved back to his hometown in Connecticut. He is offered a job at the large insurance firm

that employs most of the town. The salary they offer him is much lower than he hoped. Since the insurance firm is a monopsony in his town, when Yani writes a counter wage offer, what will most likely happen
Business
1 answer:
user100 [1]3 years ago
7 0

Answer:

With Yani's counter-wage offer, the insurance firm will likely reject his counter-offer and, in the extreme, withdraw the employment proposal with the firm.

Explanation:

As indicated in the question, the insurance company is a monopsony.  A monopsony is the single buyer in the marketplace.  This means that there is no other firm that can employ Yani in his Connecticut hometown.  He must look for another job in another environment outside his hometown or condescend to accept the lower than hoped-for salary by the large insurance firm.

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