DMVPDiscounted Marginal Value Product
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1], faced with lower MVPs for their factors, revise the DMVP schedules downward for the factors in the first stage and thereby invest less in them.
In other words, the total MVPs of the original factors are now smaller, and therefore the total DMVPs are as well.
Wherever its DMVP becomes lower, a higher demand in another use guarantees that the general DMVP schedule and the price stay the same than in the free market.
It is either specific to this sector or it is not, but if not, its higher DMVP schedule here more than compensates for the lower maximum buying prices in other sectors where it could be employed.
Its DMVP there, and its general DMVP schedule as well, then compensates for the downward pressure related to the monopolist's restriction.
The table below recapitulates for each and every factor with the "+", "-" and "0" signs when factors' DMVP schedules and prices are higher, lower or the same under monopoly than under free market conditions.
their general DMVP schedule is lower as a result of the overall lower position of demand schedules for the goods they help to produce
their general DMVP schedule is unchanged, but the factor is under monopolistic pressure.
30) one must realize, as shown in the table above with factor 1 and factor 3 that a lower general DMVP schedule is not necessary to have a lower price.