A newspaper cartoon shoes a wealthy person standing on a pile of money saying \"

Question

A newspaper cartoon shoes a wealthy person standing on a pile of money saying "your greed is hurting the economy!" to a fellow who clearly has no money but arries a sign demanding the minimum wage to be raised.

a.) What effects would a binding minimum wage have on a labor market?
b.) Suppose the man on the pile of cash earned this through profits. Are profits something that are "added on" to the costs of business, or do they represent something else?
c.) Given the answers to (a) and (b), explain whether you agree or disagree with the sentiments of the cartoon.

Explanation / Answer

by binding minimun labor wage, supply of labor would increase and at same time demand would decrease as for firms it seems unprofitable. so unemployment increases.

in normal business a firm would earn zero profit. no profits dont add on to the cost of business. i disagree with the sentiments

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