-According to the Above Figure, If the Government Imposes a Minimum

question 272

Multiple Choice

-According to the above figure, if the government imposes a minimum wage equal to Wm, the effect will be

• A) a reduction in employment from Qe to Qm.
• B) an increase in employment from Qe to Qm.
• C) a decrease in labor supplied, from C to E.
• D) an increase in labor supplied, from A to E.

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Definitions:

Open Economy

An economy that allows for trading and financial transactions with other countries.

Investment

Refers to the purchase of goods that are not consumed today but are used in the future to create wealth, such as purchasing machinery for a factory.

Net Capital Outflow

The difference between domestic residents’ investments abroad and foreigners’ investments in the domestic economy.

Net Exports

The value of a country's exports minus the value of its imports, reflecting the balance of trade between a country and its trading partners.