Which of the following government policies would fail to lower the unemployment rate ?
Correct answer: E. Raising the minimum wage
- A. Establishing worker training Programs
- B. Establishing right-to-work laws
- C. Reducing unemployment benefits
- D. Establishing employment agencies
- E. Raising the minimum wage
Explanation
A binding minimum wage raises labour costs and can reduce the quantity of labour demanded, increasing unemployment among affected workers. Training, employment agencies and lower unemployment benefits are generally intended to reduce unemployment, though their effects can vary.
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