An Increase in an Effective Federal Minimum Wage Would Tend

question 4

Multiple Choice

An increase in an effective federal minimum wage would tend to cause ________.

• A)a decrease in wage rates and an increase in employment
• B)an increase in wage rates and employment
• C)a decrease in wage rates and employment
• D)an increase in wage rates and a decrease in employment

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Definitions:

Quantity Demanded

The specific amount of a product consumers desire to buy at a particular price point, illustrating the relationship between price and demand.

Law of Supply

An economic principle stating that as the price of a good increases, suppliers will produce more of it, and as the price decreases, they will produce less.

Quantity Supplied

The total amount of a product that producers are willing and able to sell at a given price over a specified period.

Quantity Demanded

The total amount of a good or service that consumers are willing to purchase at a given price.