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(d) Suppose now the workers employed (and potentially employed) by the monopsonist become union—
ized and successfully get the monopsonjst to agree to a fixed salary of $42,500 per worker. How does
the firm’s profit—maximizing wage and employment level change under the new union agreement?
Calculate the new valuaes and graph the aggregate labor supply and demand curves, as well as the original and new Marginal Expense of Labor (M EL) lines under the union agreement.

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