1.3 The minimum wage in year 1 is $1 higher than the equilibrium wage. In year 2,...
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1.3 The minimum wage in year 1 is $1 higher than the equilibrium wage. In year 2, the minimum wage is increased so that it is $2 above the equilibrium wage.
We observe that the same number of people are working at the minimum wage in year 2 as in year 1. Does it follow that an increase in the minimum wage does not cause some workers to lose their jobs? Explain your answer.
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