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4 years ago

What are the cons to raising a minimum wage?

Business

2 answers:

Vika [28.1K]4 years ago

6 0

Hello there!

Cons of raising minimum wage:

Lower chance of hiring
More Layoffs
Not a lot of cash flow for the company

One of the cons of raising the minimum wage is the lower chance of hiring in a company. Since the companies want to be stabled with the amount of employees they have, since a company is losing money whenever they pay an employee. They will be in need of saving money, so they would lower the amount of people they are going to hire.

Another con of raising the minimum wage is a company having more layoffs. What the word "layoff" means is a company temporarily or permanently removing an employee from their company. if the minimum age increased, the companies would have to layoff a couple of workers from their company because the company would be losing money, especially when they have a lot of employees. The rise of minimum wage would hurt a company financially.

Another con of raising the minimum wage is not a lot of cash flow for the company. What this means is that the company isn't receiving a lot of money back form the products or things that they're selling due to the fact that they have to use some of that money to pay employees if the minimum wage increased. This is bad for a company because they need to receive cash flow in order to keep their company up and selling their products, if they can't do that, the company could shut down for financial reasons.

To sum it all up, a raise in the minimum wage would hurt an economy because the prices in the economy would increase, like taxes, products, etc. Everything would be so expensive to the point where people are becoming broke, and can't pay for things. Companies, the government, and other people would be getting a back lash from this.

tekilochka [14]4 years ago

3 0

Answer:

higher taxes

Explanation:

if we raise minimum wage the tax scale will also raise. our income bases off how much we pay in taxes. meaning more money, more taxes.

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3 years ago

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RideAnS [48]

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3 years ago

Sonny's BBQ Company recently issued $85 par value preferred stock that pays an annual dividend of $9. Analysts estimate that the

Bond [772]

Answer:

Intrinsic value=$73.77

Explanation:

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Price = D/Kp

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Kp- cost of preferred stock

So will need to work out the cost of equity using CAPM

The capital asset pricing model (CAPM): relates the price of a share to the market risk or systematic risk. The systematic risk is that which affects all the all the economic agents, e.g inflation, interest rate e.t.c

This model is considered superior to DVM. Hence, we will use the CAPM

Using the CAPM , the expected return on a asset is given as follows:

E(r)= Rf +β(Rm-Rf)

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3 years ago

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Vitek1552 [10]

Laissez faire model was inspired by John Stuart Mill's book "Principles of Political Economy" (1848). This model states that the government should not be heavily involved in the market, and should have a hands off approach.

I hope this helped! :)

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3 years ago

______________________ argues that the productivity of workers will increase if they are paid more, and so employers will often

kifflom [539]

Answer: Efficiency wage theory

Explanation:

The efficiency wage theory is refers to the labor economics that argues about the wages fir the labor or workers in the market.

The main aim of the efficient wage theory is that it helps in increase the efficiency and the labor productivity by reducing the cost of the turnover in industries.

This theory is mainly developed by the Alfred Marshall as they denote the wages per unit labor efficiency. Therefore, the efficiency wage theory is the correct answer.

7 0

3 years ago

What are the cons to raising a minimum wage? ​

What are the cons to raising a minimum wage?