In Figure 30.2, a minimum wage of $20 will result in a
A) Shortage of 160 workers.
B) Shortage of 180 hours.
C) Surplus of 32 workers.
D) Surplus of 20 workers.

Question

In Figure 30.2, a minimum wage of $20 will result in a
A) Shortage of 160 workers. 
B) Shortage of 180 hours. 
C) Surplus of 32 workers. 
D) Surplus of 20 workers.

Quizplus · Accepted Answer

At a minimum wage of $20, the quantity of labor supplied is 210 hours, while the quantity of labor demanded is only 178 hours. This creates a surplus of workers, as there are 32 more workers available to work than there are jobs available.