Suppose a Minimum Wage of $15 an Hour Is in Force,resulting

question 39

Multiple Choice

Suppose a minimum wage of $15 an hour is in force,resulting in unemployment of 10 million hours.Then the demand for labour increases such that supply and demand curves intersect at a wage rate of $17 per hour.What will happen to the equilibrium wage rate and employment?

• A)The wage rate is $17 an hour and there will be no unemployment.
• B)The wage rate is $17 an hour and there will be a surplus of labour.
• C)The wage rate is $15 an hour and there will be a surplus of labour.
• D)The wage rate is $15 an hour and there will be no unemployment.
• E)The wage rate is $15 an hour and there will be unemployment.

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Definitions:

Common Stock

A type of equity security that represents ownership in a corporation, entitling holders to vote on corporate matters and receive dividends.

Long-term Investment

Investments held by an entity for an extended period, typically more than one year, such as bonds, stocks, or real estate.

Equity Method

A method where an investor recognizes its share of the profits and losses of the investee company it has invested in, proportionate to its ownership percentage.

Cost Method

An accounting method used to value certain investments or transactions at their original purchase cost, without reflecting subsequent changes in market value.