If a Minimum Wage Is Set Above the Free- Market

question 82

Multiple Choice

If a minimum wage is set above the free- market equilibrium wage in a competitive labour market, the labour market will experience an increase in wages and

• A) employment will increase.
• B) there will be no unemployment.
• C) employment will decrease.
• D) employment will remain the same.
• E) there is an unpredictable effect on employment.

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Definitions:

Collection Procedures

Established methods and processes used by a company to collect payments or debts from its customers or debtors.

Terms Of Sale

Conditions on which a firm sells its goods and services for cash or credit.

Conditional Sales Contract

A conditional sales contract is an agreement in which the sale of an asset or property is contingent upon certain conditions, often including the completion of payment installments.

Default Risk

The risk that a borrower will not make the contractual interest or principal payments on their debt obligations.