Understanding the Resource Market and Minimum Wage

Mr. Clifford from ACDC Econ explains key economic concepts related to the resource market in 60 seconds. He discusses the roles of individuals as suppliers and firms as demanders, focusing on the labor market for fast food cooks. The video covers how wage levels affect hiring and job-seeking behavior, and introduces the concept of minimum wage as a wage floor. It concludes with an analysis of employment changes due to minimum wage laws, highlighting the impact on the number of workers fired, entering the industry, and becoming unemployed.

What role do individuals play in the resource market?

• Suppliers

• Regulators

• Consumers

• Demanders

How does a high wage affect a firm's hiring decision?

• Firms hire fewer workers

• Firms maintain the same number of workers

• Firms stop hiring altogether

• Firms hire more workers

What happens to the supply of labor when wages are low?

• The supply of labor becomes infinite

• The supply of labor remains unchanged

• Fewer individuals are willing to work

• More individuals are willing to work

What is a minimum wage?

• A wage that fluctuates daily

• A wage determined by market forces

• A wage floor set by the government

• A wage ceiling set by the government

Where is the minimum wage set in relation to equilibrium?

• Below equilibrium

• At equilibrium

• Above equilibrium

• It varies

What is the effect of a minimum wage on the number of workers fired?

• No workers are fired

• Workers are hired instead

• All workers are fired

• Some workers are fired

How does a higher minimum wage affect the number of workers entering the industry?

• Fewer workers enter

• More workers enter

• Workers leave the industry

• The number of workers remains the same

What is the result of a surplus of workers in the labor market?

• Increased employment

• Decreased unemployment

• Increased unemployment

• Stable employment

What happens to the quantity of labor demanded when the minimum wage is implemented?

• It becomes zero

• It increases

• It decreases

• It remains the same

How many workers became unemployed due to the new minimum wage law?

• 70 workers

• 50 workers

• 20 workers

• 100 workers