The following figures show the demand and supply of labor in two different types of labor market. Figure 29.5
In the figures,
D: Demand curve for labor
S: Supply curve of labor
MRP: Marginal revenue product
MFC: Marginal factor cost
In Figure 29.5, if a minimum wage of $10 is set by the government, then in market B:
A) wage increases but labor employment decreases.
B) wage increases but labor employment remains constant.
C) wage decreases from $12 to $10.
D) both wage and employment increase.
E) both wage and employment decrease.
Correct Answer:
Verified
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