Other things the same,in the long run a country that reduces the minimum wage from very high levels will have
A)higher unemployment and lower inflation
B)lower unemployment and higher inflation
C)higher unemployment and the same level of inflation
D)lower unemployment and the same level of inflation

Question

Quizplus · Accepted Answer

Reducing the minimum wage would lead to lower production costs for firms, resulting in an increase in labor demand which would lower unemployment. However, since there is no change in the supply of money, inflation will remain constant.

Other Things the Same,in the Long Run a Country That