Binding Minimum-Wage Laws

question 60

Multiple Choice

Binding minimum-wage laws

• A)are costly for the government to impose.
• B)force a market imbalance between the supply and demand for labor.
• C)have the potential to provide benefits to all poor people, whereas a negative tax can only benefit some poor people.
• D)do not affect segments of the population who are not poor.

---

Definitions:

Subsidies

Financial support provided by a government to reduce the costs of producing goods or services, intended to encourage production or consumption.

Agricultural Subsidies

Financial support provided by the government to farmers to help stabilize food prices, ensure a steady supply of agricultural products, or directly increase farmers' incomes.

Misallocation Of Resources

The inefficient distribution or use of resources in an economy, leading to outcomes where goods or services are not produced at their highest valued use.