Multiple Choice
Suppose the demand for labor is highly elastic. Which statement would BEST describe the effect of a minimum wage law that increased the wage rate by 10%?
A) There would be a greater than 10% increase in workers hired.
B) Firms would not substitute capital for labor.
C) Total wages earned by workers would rise by more than 10%.
D) Employment opportunities would drop by more than 10%.
Correct Answer:
Verified
Correct Answer:
Verified
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