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The Equilibrium Wage For Low-Skilled Workers Assignment Paper Question EC 2. A minimum wage is a set above the equilibrium wage for low-skilled workers. This means A. price ceiling; given the inelasticity of low-skilled labor supply and demand, a small surplus of workers will result. B. price floor; given the elastic nature of low-skilled labor supply and demand, a large shortage of workers will result. C. price ceiling; given the elastic nature of low-skilled labor supply and demand, a large surplus of workers will result. D. price floor; given the inelasticity of low-skilled labor supply and demand, a small surplus of workers will result The Equilibrium Wage For Low-Skilled Workers Assignment Paper ORDER YOUR PAPER NOW Step-by-step Step 1/1 The market for labor works like any other market. There is both a supply side where workers supply their labor and a demand side where firms demand labor. The market for labor reaches equilibrium at the point where the supply of and demand for labor is equal, resulting in an equilibrium wage. The minimum wage is a type of price floor imposed by the government for supporting low-skilled workers. The aim is to increase the earnings of low-skilled workers and improve their welfare. A minimum wage set above the equilibrium wage generates a surplus in the market. This is because the quantity supplied of labor exceeds the quantity demanded at the set minimum wage. The higher wages motivate more workers to enter the market while firms demand fewer workers to control costs. The mismatch of demand and supply results in a surplus. Workers who are unable to find jobs remain unemployed, resulting in a surplus of labor. The Equilibrium Wage For Low-Skilled Workers Assignment Paper Based on the above explanation, we can conclude that a minimum wage is a price floor set above the equilibrium wage rate that results in the generation of surplus in the market. Hence, Option D is right. Option A is incorrect because a minimum wage is type of a price floor, not a price ceiling. Option B is incorrect because a minimum wage results in a surplus of labor in the market. Option C is incorrect because a minimum wage is type of a price floor, not a price ceiling. Explanation for step 1 Option D is right. A minimum wage is a price floor set above the equilibrium wage rate that results in the generation of surplus in the market. Final answer A minimum wage is a price floor set above the equilibrium wage rate that results in the generation of surplus in the market. Hence, the right answer is Option D. The Equilibrium Wage For Low-Skilled Workers Assignment Paper
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The Equilibrium Wage For Low-Skilled Workers Assignment Paper

Question

EC 2. A minimum wage is a set above the equilibrium wage for low-skilled workers. This means A. price ceiling; given the inelasticity of low-skilled labor supply and demand, a small surplus of workers will result. B. price floor; given the elastic nature of low-skilled labor supply and demand, a large shortage of workers will result. C. price ceiling; given the elastic nature of low-skilled labor supply and demand, a large surplus of workers will result. D. price floor; given the inelasticity of low-skilled labor supply and demand, a small surplus of workers will result The Equilibrium Wage For Low-Skilled Workers Assignment Paper

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Step-by-step

Step 1/1
The market for labor works like any other market. There is both a supply side where workers supply their labor and a demand side where firms demand labor. The market for labor reaches equilibrium at the point where the supply of and demand for labor is equal, resulting in an equilibrium wage.
The minimum wage is a type of price floor imposed by the government for supporting low-skilled workers. The aim is to increase the earnings of low-skilled workers and improve their welfare.
A minimum wage set above the equilibrium wage generates a surplus in the market. This is because the quantity supplied of labor exceeds the quantity demanded at the set minimum wage. The higher wages motivate more workers to enter the market while firms demand fewer workers to control costs. The mismatch of demand and supply results in a surplus. Workers who are unable to find jobs remain unemployed, resulting in a surplus of labor. The Equilibrium Wage For Low-Skilled Workers Assignment Paper
Based on the above explanation, we can conclude that a minimum wage is a price floor set above the equilibrium wage rate that results in the generation of surplus in the market. Hence, Option D is right.
Option A is incorrect because a minimum wage is type of a price floor, not a price ceiling.
Option B is incorrect because a minimum wage results in a surplus of labor in the market.
Option C is incorrect because a minimum wage is type of a price floor, not a price ceiling.
  • Explanation for step 1
Option D is right. A minimum wage is a price floor set above the equilibrium wage rate that results in the generation of surplus in the market.
Final answer
A minimum wage is a price floor set above the equilibrium wage rate that results in the generation of surplus in the market. Hence, the right answer is Option D. The Equilibrium Wage For Low-Skilled Workers Assignment Paper

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