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#cfa #cfa-level-1 #economics #microeconomics #reading-13-demand-and-supply-analysis-introduction #study-session-4
Although controversy remains among some economists on the empirical effects of the minimum wage, most economists continue to believe that a minimum wage can reduce employment. Although some workers will benefit, because they continue to work at the higher wage, others will be harmed because they will no longer be working at the increased wage rate.
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3.13. Market Interference: The Negative Impact on Total Surplus
lus triangle d. As a result of the floor, the buyer’s surplus is reduced to triangle a. A good example of a price floor is the imposition of a legal minimum wage in the United States, the United Kingdom, and many other countries. <span>Although controversy remains among some economists on the empirical effects of the minimum wage, most economists continue to believe that a minimum wage can reduce employment. Although some workers will benefit, because they continue to work at the higher wage, others will be harmed because they will no longer be working at the increased wage rate. EXAMPLE 11 Calculating the Amount of Deadweight Loss from a Price Floor A market has demand function given by the equation Q d = 180 –


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