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In the labor market, the minimum wage is: a. A market-clearing price. b. A payroll tax. The minimum wage therefore leads to a left shift

In the labor market, the minimum wage is:

a. A market-clearing price.

b. A payroll tax. The minimum wage therefore leads to a left shift of the supply curve.

c. A floor price. If it is restrictive, the minimum wage creates unemployment which corresponds to a surplus (excess supply).

d. A ceiling price. If it is restrictive, the minimum wage creates unemployment which corresponds to a shortage (excess demand).

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