-An increase in the minimum wage will tend to cause which of the following to occur?
A) an increase in the size of the surplus of labor
B) a leftward shift in the demand for labor
C) a rightward shift in the supply of labor
D) a reduction in the unemployment rate

Question

-An increase in the minimum wage will tend to cause which of the following to occur?
A) an increase in the size of the surplus of labor 
B) a leftward shift in the demand for labor 
C) a rightward shift in the supply of labor 
D) a reduction in the unemployment rate

Quizplus · Accepted Answer

An increase in the minimum wage tends to create a surplus of labor because at the higher wage, more people are willing to work than there are jobs available, leading to an increase in unemployment or a surplus of labor. Employers may not hire as many workers at the higher wage, contributing to this surplus.

-An Increase in the Minimum Wage Will Tend to Cause