2. Minimum wage legislation The following graph gives the labor market for the fast-food industry of the imaginary city of Combopolis. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. WAGE (Dollars per hour) 20 Graph Input Tool Market for Labor in the Fast Food Industry (Dollars per hour) Labor Demanded (Hundreds of workers) 630 Labor Supplied (Hundreds of workers) 18 Wage 16 Supply 14 12 10 Demand 0 90 180 270 360 450 540 630 720 810 900 LABOR (Hundreds of workers) In this market, the equilibrium wage is per hour, and the equilibrium quantity of labor is [ Suppose the mayor of Combopolis introduces a legal minimum wage of $6 per hour. This type of price control is called a hundred workers. For each of the wages listed in the following table, determine the quantity of labor demanded, the quantity of labor supplied, and the direction of pressure exerted on wages in the absence of any price controls. Wage Labor Demanded Labor Supplied (Dollars per hour) (Hundreds of workers) (Hundreds of workers) Pressure on Wages 12 8 True or False: A minimum wage above $10 per hour is not a binding minimum wage in this labor market. True O False

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Labor Force Participation Rate analysis

The labor force participation rate analysis calculates the percentage of the working-age population either employed or actively seeking work. It can be anyone in the age category of 16 to 64, on the condition that they are not institutionalized. A high labor force participation rate shows that more people are employed and contributing their wages to the economy, making it a healthy economy. It also shows that there are more people actively looking for employment leading to more hiring options for employers. On the other hand, a low labor force participation rate shows a low number of people employed or looking for work. This leads to an economic setback with fewer wages going into the economy. In such a scenario, employers might have to cut back on profits, lay off employees, or stop the process of hiring.