1. Statement 1: The result of an effective minimum wage is a surplus of workers in the labor market. Statement 2: An effective minimum wage acts as a price ceiling on the wage that businesses pay workers. Statement (1) and statement (2) are both true. Statement (1) and statement (2) are both false. Statement (1) is true; statement (2) is false. Statement (1) is false; statement (2) is true.
1. Statement 1: The result of an effective minimum wage is a surplus of workers in the labor market. Statement 2: An effective minimum wage acts as a
Statement (1) and statement (2) are both true.
Statement (1) and statement (2) are both false.
Statement (1) is true; statement (2) is false.
Statement (1) is false; statement (2) is true.
2. An upward sloping supply curve of labor suggests that:
There is no substitution effect.
The substitution effect outweighs the income effect.
The income effect outweighs the substitution effect.
The income and substitution effects exactly offset each other.
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