(Last Word) Which of the following best explains why an increase in the minimum wage is more problematic for mom and pop restaurants than for big chain restaurants?
A) Chain restaurants are exempt from minimum wage laws.
B) Mom and pop restaurants have more difficulty attracting workers when wages rise.
C) Mom and pop restaurants are more dependent on labor relative to chain restaurants.
D) Chain restaurants have more monopoly pricing power and can more easily raise prices than mom and pop stores.

Question

Quizplus · Accepted Answer

Mom and pop restaurants are typically smaller and have fewer employees, so an increase in the minimum wage has a greater impact on their labor costs compared to larger chain restaurants. Therefore, they are more dependent on labor relative to chain restaurants.

(Last Word) Which of the Following Best Explains Why an Increase