Question

The CEO of a multinational retail corporation has decided to raise the minimum wage for its U.S. employees to three times the current federal minimum wage. The CEO explains that the company needs to provide its employees a living wage, regardless of what the law requires. According to Milton Friedman, did the corporation fulfill its duty

Answer 1

Answer: No. Because the wage hike will drastically increase the corporation liabilities and likely harm its stock price.

Step-by-step explanation:

According to Milton Friedman, the corporation did not fulfill its duty. This is because the wage hike will drastically increase the corporation liabilities and likely harm its stock price.

One of the duties of an organization include cost minimization and profit maximization. In this scenario, raising the minimum wage for its employees to about three times the income isn't a good move and will bring about a negative impact on the revenue of the company and its stock.

Answer 2

No, because the wage hike will drastically increase the corporation's liabilities and likely harm its stockprice

Step-by-step explanation:

Milton Friedman was an economist who received Nobel Peace Price in Economic Science in 1976.

According to him increase in money supply is very important in economic development.

In the given scenario although the increase in wages of its employees will benefit the employees in the short run, it will eventually be detrimental.

This is because the liabilities to the business will increase and this will affect its stock price.

So the action of increasing the wages of employees will harm business.

They have not fulfilled their duty of ensuring adequate cash flow