There aren't that many moving parts in this economy.
Price goes up.
Supply shifts left.
What might you be missing? Labor?
If the market equilibrium wage is $6.00/hr and the Federal Minimum
Wage increases to $7.25; demonstrate the anticipated outcome with the aid
of a Supply and Demand curve.
im not sure if im doing this right, but i would draw a graph showing the equilibrium at $6.00 because the wage goes up, then my new quantity would shift to the left. right but i feel as though im missing something...thanks in advance
ok well your right there arent many working parts to the problem. so for the sketch i showed basically that my minimum wage was changed to 7.25/hr which created a floor, and that there was a surplus of people who wanted to work. im not sure if i am correct of this assumption, but i argued that due to the floor, there was some dead weight loss? and i basically shaded in the region to show that. i dont have access to a scanner as of yet so i wont be able to post the problem. i was also wondering if there might be some consumer surplus. well i came across this webpage and i was wondering if this might apply to my scenario or problem. www.macalester.edu/courses/econ119/robertson/c119f06h3s.doc
thanks in advance.