According to the Department of Labour's new rates, domestic workers working in Area A (bigger

metropolitan areas) who work more than 27 ordinary hours per week, must be paid a minimum

of R13,69 per hour.

Workers who work fewer than 27 hours per week, must be paid a minimum of R16,03 per hour.

With the aid of a diagram, discuss the welfare effect of this new legislation if the new minimum

wage is (1) below the equilibrium wage and (2) above the equilibrium wage rate with labour

hours as your quantity variable.