When a minimum-wage law forces the wage to remain above the level that balances supply and demand, there are more workers willing to work than there are jobs, so some workers are unemployed.

Question

Quizplus · Accepted Answer

When the minimum wage is set above the equilibrium level (where supply equals demand), it results in a surplus of labor, meaning there are more workers willing to work at that wage than there are jobs available, leading to unemployment.

When a Minimum-Wage Law Forces the Wage to Remain Above