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4.02 Should the Government Control the Economy?
Transcript of 4.02 Should the Government Control the Economy?
When the minimum wage is increased
businesses will pay higher than the equilibrium wage. So this means that if the price is above equillbrium there would be a surplus. and if the price is below the equilibrum it would cause a shortage
Pros and Cons of a wage Increase
Consumers make more and spend more
Employees are more happier and productivity is higher
Businesses have less turnover
saves on retraining costs
Government expenses for social programs aimed at the poor would be reduced.
Minimum wage is the amount of money that the government says is the least amount that a business can pay an indiviual. So if the minimum wage $7.95 per hour even with working a 40hr work week any person would have a difficult time making ends meet. That amount of money is not enough to substaintally and adequately take care of a family of 3. With all of the other bills that have to be paid such as rent, utilities, insurance and health insurance, they would be barely able to afford some of the other things like food. Raising the minimum wage would be a good way to boost our economy because if people are making enough money to take care of there household then they will spend more. That is why I think the minimum wage should be increased.
The question of raising minimum wage has been an on going debate for many years. In the state of Florida the minimum wage is $7.93 per hour. An indiviual would have to work two jobs at a 40 hr work week to even begin to provide for a family of 3. many families these days are having to do just work two jobs to be able to pay bills and have some of the necessities of life.
Some people feel that by raising the minimum wage that it will likey reduce turnover and make employees feel more willing to work. Those who will benefit the most by increasing the wages will be the businesses, because it will put more money into the hands of the consumers who will then in turn purchase more goods and services.
Higher prices to offset the labor
Small businesses would suffer