ECON MICRO (with MindTap, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
6th Edition
ISBN: 9781337408059
Author: William A. McEachern
Publisher: Cengage Learning
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Question
Chapter 4, Problem 15P
To determine
The effect of minimum wage on the unskilled labor market.
Concepts Introduced Wage Floor - It is the minimum wage or wage bracket established by law. It is the floor below which the prices are not allowed to fall in an industry or sector.
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(Figure: Labor Market) Refer to the labor market shown here. A minimum wage of $18 per hour is introduced. The implementation of the minimum wage leads to a _____ of _____ workers.
M8
9. Minimum wage legislation
The following graph shows the labor market in the fast-food industry in the fictional town of Supersize City.
Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph.
Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly.
WAGE (Dollars per hour)
20
18
16
14
12
10
2
0
0
Supply
Demand
80 160 240 320 400 480 560 640 720 800
LABOR (Thousands of workers)
Graph Input Tool
Market for Labor
Wage
(Dollars per hour)
Labor Demanded
(Thousands of
workers)
the Fast Food Industry
8
480
Labor Supplied
(Thousands of
workers)
320
Chapter 4 Solutions
ECON MICRO (with MindTap, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
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