Is minimum wage a price floor or ceiling?
Understand the Problem
The question is asking whether the minimum wage is considered a price floor or a price ceiling in economic terms. A price floor is a minimum price set by authorities, while a price ceiling is a maximum price limit.
Answer
price floor
The final answer is that minimum wage is a price floor.
Answer for screen readers
The final answer is that minimum wage is a price floor.
More Information
A price floor is a minimum legal price set by the government. In the case of minimum wage, it sets the lowest hourly rate that can be paid to workers, aiming to ensure a livable income for them.
Sources
- Minimum Wage and Price Floors | Economics 101 - youtube.com
- Example of Price Floor: Minimum Wage | Microeconomics - courses.lumenlearning.com
- Minimum Wage and Price Floor Example - mru.org
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