a)Provide an analysis of how the minimum wage is likely to affect the market for low-skilled workers. To make the analysis easier, assume that all markets are perfectly competitive and there is no minimum wage at time 0 and then introduce the minimum wage at time 1.

B)Does the time horizon matter? (long run versus short run)

D)Does your assumption about perfect competition in the product market affect your predictions? How?

E)Could the minimum wage indirectly affect the market for skilled workers? Explain.

F)What is the goal of minimum wage policy? Is this goal achieved? Explain briefly.