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Unintended effects of government actions Suppose that, in an attempt to help the working poor, the government recently passed legislation that increases the minimum wage from $6 per hour to $7 per hour

Economics

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Unintended effects of government actions Suppose that, in an attempt to help the working poor, the government recently passed legislation that increases the minimum wage from $6 per hour to $7 per hour. The following graph input tool shows the labor market. The horizontal line indicates the initial level of the minimum wage. You can see the effect of the change in the minimum wage law on the market for unskilled labor by changing the value in the Wage box. The values in the boxes on the right side of the calculator will change accordingly. (Note: You will not be graded on any changes made to the graph input tool.) Graph Input Tool Labor Market to 9 Supply of Workers 6 B Wage (Dollars) Quantity Demanded (Number of workers) 200 Quantity Supplied (Number of workers) 300 WAGE (Dollars) bemand for Labor 1 0 300 500 100 200 400 QUANTITY (Number of workers)
number of unskilled workers demanded. Thus, an unintended effect of the increase in the An increase in the minimum wage leads to a minimum wage is that: Those who were not employed before the law change remain unemployed Some unskilled workers become unemployed Employers of unskilled workers now face higher labor costs Suppose that the government decides that too many people cannot afford to rent an apartment at the equilibrium rent and thus end up homeless. The government therefore decides to impose rent control, which forces landlords to price apartments below the equilibrium rent. Which of the following is an unintended effect of rent control? Check all that apply. The quality of rental housing units falls, There is a shortage of rental apartments, The future supply of rental housing units increases.