A minimum wage law set above the equilibrium wage rate is unfair because the minimum wage
A)does not apply to all workers.
B)boosts the income of highly skilled workers.
C)benefits only those workers who are able to find and keep a job.
D)benefits nobody.
E)cannot be enforced.

Question

Quizplus · Accepted Answer

Setting a minimum wage above the equilibrium wage rate results in labor surplus and reduces employment opportunities, leading to higher unemployment rates. The workers who are employed are benefited by getting higher wages, but those who lose their jobs are worse off. Therefore, the minimum wage law benefits only those workers who are able to find and keep a job.

A Minimum Wage Law Set Above the Equilibrium Wage Rate