How does an increase in the minimum wage affect the economy.PeriodMinimum Wage RateUnemployment RateInflationRateEconomic GrowthLabour Force Participation2019 - 2020$17.502.8%0.5%2.8%59.8%2014 – 2018$15.002.71%3.5%2.71%62.6%2010 - 2013$12.502.21%2.1%2.21%61.7%

Answered: How does an increase in the minimum…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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How does an increase in the minimum wage affect the economy.

Period	Minimum Wage Rate	Unemployment Rate	Inflation Rate	Economic Growth	Labour Force Participation
2019 - 2020	$17.50	2.8%	0.5%	2.8%	59.8%
2014 – 2018	$15.00	2.71%	3.5%	2.71%	62.6%
2010 - 2013	$12.50	2.21%	2.1%	2.21%	61.7%

Definition Definition Increase in the amount of goods and services produced by a country in a given period of time compared to an earlier period. Economic growth is generally coupled with a rise in national income or the purchasing power of individuals. It is often measured in terms of the increase in a country's gross domestic product (GDP), or the overall monetary value of all the complete or final services and goods that a country can produce within its domestic boundaries in a specific period.

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The minimum wage rate is the government determined minimum wage which the employer must provide to an employee for making use of the labor power. Thus, the minimum wage is similar to that of a price floor which is the government determined minimum price that should be provided to get the commodity from the seller. The minimum wage becomes effective when it is determined above the equilibrium market wage rate.

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