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1 September, 07:47

True or false: a minimum wage above $10 per hour is not a binding minimum wage in this market. (economists call a minimum wage that prevents the labor market from reaching equilibrium a binding minimum wage.)

a. True

b. False

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Answers (1)
  1. 1 September, 08:24
    0
    The given statement is False. In order to bind the labor markets so that equilibrium is not reached, one has to set the minimum wages above $10. Hence when the wage is set below the minimum wage then it will not be binding and any minimum wage set above the minimum wage will be a binding wage.
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