Evaluate the statement: All minimum wage workers will be better off if the minimum wage rises.
What will be an ideal response?
This is probably incorrect. The minimum wage workers who keep their jobs will be better off. But if the labor demand curve is downward sloping (and it most likely is for minimum wage workers), some workers will lose their jobs. Everyone (including the workers) will pay more for the goods and services produced by minimum wage workers.
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The Federal Reserve System controls the money supply by ________.
A. making loans to private borrowers B. changing the amount of reserves the banking system has available C. making loans to the Treasury D. issuing currency
Direct controls are considered inefficient because all firms are forced to pay the same costs
a. True b. False Indicate whether the statement is true or false
M1 has decreased in its usefulness in understanding inflation due to:
A. more reliance on the use of currency. B. the increased use of checks in the economy. C. the introduction of money market mutual fund shares and similar checking substitutes. D. the increased use of electronic payments.
Refer to the graph shown. An exchange rate of $2.95 per dinar creates excess:
A. supply of dinar that will cause the dinar to lose value, unless dinar are bought by the government. B. supply of dinar that will cause the dinar to lose value, unless dinar are sold by the government. C. supply of dinar that will cause the dinar to gain value, unless dinar are bought by the government. D. demand for dinar that will cause the dinar to gain value, unless dinar are sold by the government.