- Most common price floor = minimum wage
- When you set a price (or wage) floor,
* Quantity demand for employers goes down because firms don't want to hire as many workers
* Quantity supply for employers goes up because more workers want to make more $
- As a result of all this, a surplus of workers develops and this causes higher rates of unemployment
- Is there a better way to pay workers --> E.I.T.C. (Earned Income Tax Credit)
Illegal Drugs
- making them illegal means you keep the same point (price) of equilibrium, but the supply curve becomes steeper because it costs more to supply these drugs
- As a result, the people who handle drug transactions are only those who know what they're doing
-Rizzo
Daniel Gaona
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