What are the effects of a minimum wage set below the equilibrium wage?
What will be an ideal response?
If the minimum wage is set below the equilibrium wage, then the law has no impact on the labor market equilibrium wage and quantity.
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One role government can play in addressing market failure is to
A) enforce the rules of exchange. B) facilitate decision making for private goods. C) promote imperfect competition. D) increase economic uncertainty.
As a result of the 2008-2009 financial crisis and the decrease in GDP in many European economies, we would expect
A) an increase in the demand for U.S. exports and a leftward shift in the demand curve for dollars. B) a decrease in the demand for U.S. exports and a leftward shift in the demand curve for dollars. C) a decrease in the demand for U.S. exports and a rightward shift in the demand curve for dollars. D) a decrease in the demand for U.S. imports and a movement up along the demand curve for dollars.