Assuming that labor demand is downward-sloping, a minimum wage set above the equilibrium wage will cause the number of workers to
A) increase
B) stay unchanged
C) decrease

Question

Quizplus · Accepted Answer

When the minimum wage is set above the equilibrium wage, the cost of hiring workers increases for employers. This causes a reduction in the quantity of labor demanded, leading to fewer job opportunities and ultimately causing unemployment. Hence, the number of workers will decrease in this scenario.

Assuming That Labor Demand Is Downward-Sloping, a Minimum Wage Set