(Figure: Labor Market) Refer to the labor market shown here. Suppose a minimum wage of $18 per hour is introduced. After the implementation of the minimum wage, _____ workers are hired.

Question

Quizplus · Accepted Answer

The minimum wage of $18 per hour is higher than the equilibrium wage rate of $15 per hour. As a result, the quantity of labor supplied will increase from 20,000 to 30,000, and the quantity of labor demanded will decrease from 30,000 to 24,000. This creates a surplus of labor, as the quantity supplied exceeds the quantity demanded at the new minimum wage of $18 per hour. Therefore, 24,000 workers will be hired after the implementation of the minimum wage.

(Figure: Labor Market) Refer to the Labor Market Shown Here