Refer to the information provided in Figure 13.3 below to answer the questions that follow. Figure 13.3
-Refer to Figure 13.3. A minimum wage of $12

Question

Refer to the information provided in Figure 13.3 below to answer the questions that follow.  Figure 13.3
-Refer to Figure 13.3. A minimum wage of $12

Quizplus · Accepted Answer

In Figure 13.3, the equilibrium wage is $10 and the equilibrium quantity of labor is 200. If the minimum wage is set at $12, it is above the equilibrium wage and will therefore create a surplus of labor. Employers will demand less labor at the higher wage rate and more workers will be willing to supply labor at the higher wage rate, resulting in unemployment. The amount of unemployment will be equal to the difference between the quantity of labor supplied (240) and the quantity of labor demanded (200), which is 40. Therefore, the correct choice is C.

Refer to the Information Provided in Figure 13