Question

As a politician, you would be more inclined to propose an increase in the minimum wage when you believe that the new minimum wage would:
a. remain below the equilibrium wage and be binding.
b. remain above the equilibrium wage and be binding.
c. be equal to the equilibrium wage.
d. remain below the equilibrium wage and be nonbinding.
e. remain above the equilibrium wage and be nonbinding.

Answer 1

The answer is c. Be equal to the equilibrium wage.