Figure 20-1
-Refer to Figure 20-1.If the government imposes a minimum wage of $8,then unemployment will increase by

Question

Figure 20-1 
-Refer to Figure 20-1.If the government imposes a minimum wage of $8,then unemployment will increase by

Quizplus · Accepted Answer

In the graph, we can see that when the minimum wage is $8, the quantity of labor supplied is higher than the quantity demanded. This creates a surplus of labor, also known as unemployment. The distance between the quantity supplied and quantity demanded at $8 is 4,000 workers, so the answer is (C) 4,000 workers. This is because, at this higher wage rate, more people are willing to offer their labor services, but fewer employers are willing to pay that amount. Therefore, there is an excess supply of labor, or unemployment.

Figure 20-1 -Refer to Figure 20-1.If the Government Imposes a Minimum Wage