Asked by chisom chikezie on Jul 15, 2024
Verified
When a minimum-wage law forces the wage to remain above the equilibrium level, the result is
A) both a shortage of labor and a shortage of jobs.
B) a shortage of labor and a surplus of jobs.
C) a surplus of labor and a shortage of jobs.
D) both surplus of labor and a surplus of jobs.
Surplus of Labor
A situation in which the supply of labor exceeds the demand for labor, often resulting in unemployment or underemployment.
Minimum-Wage Law
Legislation that sets the lowest hourly wage rate that an employer can legally pay its workers, intended to protect workers from exploitation.
Equilibrium Level
A condition where the amount of goods and services available in the market equals the demand for them, leading to stable pricing and quantity levels.
- Learn about the consequences that minimum wage regulations exert on employment and unemployment figures.
Verified Answer
KB
Karandeep BainsJul 20, 2024
Final Answer :
C
Explanation :
A minimum-wage law set above the equilibrium level causes a surplus of labor (more people are willing to work at the higher wage than there are jobs available) and a shortage of jobs (employers offer fewer jobs at the higher wage than there are workers willing to take them).
Learning Objectives
- Learn about the consequences that minimum wage regulations exert on employment and unemployment figures.