Government Intervention To Protect Suppliers And Employees Flashcards
1
Q
Two options of how the government intervenes
A
Directly or indirectly
2
Q
What does the buying power of a monopsony mean
A
They can exploit their bargaining power with a supplier to negotiate lower prices which reduces the producer surplus / profits of many businesses in the supply-chain
3
Q
What is one option for intervention to protect employees
A
Enforces a minimum price for suppliers - for example a minimum wage in the labour market
4
Q
What is the aim for monopsony businesses and their suppliers
A
To reach a commercial agreement to achieve a more equitable distribution of revenues and profits
