A Binding Minimum Wage Results In

question 45

Multiple Choice

A binding minimum wage results in:

• A) higher wages for those who were working prior to the minimum wage implementation.
• B) an increase in structural unemployment.
• C) a decrease in the amount of cyclical unemployment.
• D) lower actual unemployment rates since higher wages encourage more people to enter the labour force.

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Definitions:

Consumer Credit

A type of credit granted to consumers to finance personal purchases.

Retail Credit

An arrangement where retailers offer direct credit facilities to their customers for the purchase of goods and services.

Work-in-progress

Refers to the intermediate goods or partially finished goods that are in the process of production.

Raw Materials

Basic materials or substances used in the initial stages of manufacturing or production.