Question

If minimum wage laws are generally nonbinding and do not affect the equilibrium wage, then what is the purpose of implementing a minimum wage? Correct Answer(s) It leads employers to create better working conditions out of fear that a binding law may soon be imposed. It works to reduce the existing unemployment rate. It holds out the promise for low-income voters of a betterment i

Answer 1

It holds out the promise for low-income voters of a betterment in thei situation

Step-by-step explanation:

A non-binding law or the non-binding minimum wage means that it is not obligatory for employers to carry out the minimum wage, so there´s no real promise or certain thing that would make the minimum wage to raise, it is just a promise or a hope for the lower social classes that their situation willl improve and with that politics are abel to gain voters.

Answer 2

The most suitable and correct answer to the given question out of the four options provided are:

• It leads the employer to create better working conditions due to fear of a binding law to be imposed soon.
• It holds out the promise for betterment of low income voters

Step-by-step explanation:

The main purpose of minimum wage law is to ensure that no employer in a firm is paid less than the government's mandate.

The major reason for implementing a minimum wage is due to the rise in wages even above equilibrium wage when non binding minimum wages are implemented. Thus , low income voters get their situations better.

There is a fear of binding minimum wage in future in the employers. Thus it leads the employers to help create better working conditions.