A minimum-wage law is instituted. The minimum wage is higher than the equilibriu
ID: 1115631 • Letter: A
Question
A minimum-wage law is instituted. The minimum wage is higher than the equilibrium wage for workers in the thingamabob industry. Assume that the minimum-wage law is enforced. This will lead to a decrease in the number of workers who are actually hired in the thingamabob industry. This reduction will be larger if
Question 11 options:
a)
the elasticity of demand for workers in the thingamabob industry is larger.
b)
the elasticity of demand for workers in the thingamabob industry is smaller.
c)
the elasticity of supply of workers in the thingamabob industry is larger.
d)
the elasticity of supply of workers in the thingamabob industry is smaller.
e)
climate change leads to melting of the ice in Greenland.
a)
the elasticity of demand for workers in the thingamabob industry is larger.
b)
the elasticity of demand for workers in the thingamabob industry is smaller.
c)
the elasticity of supply of workers in the thingamabob industry is larger.
d)
the elasticity of supply of workers in the thingamabob industry is smaller.
e)
climate change leads to melting of the ice in Greenland.
Explanation / Answer
a) If the minimum wage is higher than the equilibrium wage there would be a decrease in the number of workers who are employed.
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