If the minimum wage is set too high, in some labor markets we can expect to see
A) a shortage of labor.
B) an increase in on-the-job training.
C) a surplus of labor.
D) a decline in wage costs.

Question

Quizplus · Accepted Answer

A minimum wage set too high would raise the cost of labor above the equilibrium, resulting in a surplus of labor as more people would be willing to work at that wage than there are available jobs. This surplus would then lead to increased competition for the jobs and potentially lower wages in the long run.

If the Minimum Wage Is Set Too High, in Some