A Minimum Wage Law (That Sets the Minimum Wage Above

question 3

Multiple Choice

A minimum wage law (that sets the minimum wage above the equilibrium wage) can be expected to

• A) clear the market for unskilled workers.
• B) increase the number of unskilled workers employed.
• C) increase the number of firms in those industries where the law is effective.
• D) reduce the number of unskilled workers employed and/or reduce the number of hours worked by unskilled workers.
• E) all of the above

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Definitions:

Cost Drivers

Factors that cause the cost of an activity or operation to increase or decrease, such as machine hours, labor hours, or the volume of production.

Flexible Budget

A budget that adjusts or flexes for changes in the volume of activity, providing a more useful comparison of actual to budgeted performance.

Guests

Individuals who receive services or hospitality, often in contexts such as hotels, restaurants, or events.

Billafuerte Jeep Tours

A hypothetical or specific company offering guided jeep tours in the Billafuerte region.