Read the following article, which introduces one of the most debated topics in economics: minimum wage. Then answer the question that follows.▼ THE DOUBLE-EDGED SWORD OF MINIMUM WAGE, BY THE APLIA ECONOMICS TEAMWhile the federal minimum wage of $7.25 per hour has remained unchanged since 2009, 20 states increased their minimum wage at the start of 2017. For example, in Massachusetts, the minimum wage rose from $10 to $11 per hour, affecting about 291,000 workers according to an article from AreaDevelopment (Dale D. Buss, "Raising Minimum Wages: A Double-Edged Sword," Area Development, Q2 2017). In California, the minimum wage went up 50 cents, to $10.50 per hour, boosting pay for 1.7 million people. Across the nation, about 4.3 million people received a raise because they earn less than thenew minimum where they live, according to the Economic Policy Institute. As minimum wages rise across the United States, most of the affected jobs are low-wage positions in sectors such as quick-serve restaurants, retail stores, and hotels.The catch? Clearly a higher minimum wage benefits unskilled, low-pay workers by increasing their discretionary income and ultimately consumer spending, which is good for the economy. So why then is the minimum wage in the very center of the political debate? The reason is that the businesses that hire mostlyunskilled workers earning the minimum wage will not be able to afford the same number of workersthey have to pay them a higher wage. To stay afloat, these businesses will either cut production or require special treatment from the state such as subsidies or tax exemptions. All of this will have a negativeimpact on the economy, and it's not immediately apparent whether the positive effect due to increased consumer spending will offset the negative effect due to reduced production and reduced government revenue.For example, consider the state of Illinois, which has been experiencing stagnant economic growth and needs to boost its economy. A recent editorial in the Chicago Tribune (Editorial Board, "Stifling Growth in Illinois: Next Step, Raise the Minimum Wage Higher Than Every State's Border," Chicago Tribune, May 1,2017) makes the following point:But in Baltimore, freshman Mayor Catherine Pugh protected her city's fragile economy by vetoing an ordinance in March that would haveraised the minimum wage to $15 an hour by 2022. She said the ordinance, if enacted, would have made her city an outlier and lesscompetitive with nearby cities and suburbs. She's taking mega heat for her veto.May we import her to Springfield?True or False: In a competitive labor market, increasing the minimum wage always raises the number of employed workers.O TrueO False

In a competitive labor market increase in the minimum wages may or may not increase the number of…

Read the follovwing article, which introduces one of the most debated topics in economics: minimum wage. Then answer the question that follows. - THE DOUBLE-EDGED SWORD OF MINIMUM WAGE, BY THE APLIA ECONOMICS TEAM While the federal minimum wage of $7.25 per hour has remained unchanged since 2009. 20 states increased their minimum wage at the start of 2017. For example. in Massachusetts, the minimum wage rose from $10 to S11 per hour, affecting about 291.000 workers according to an article from Area Development (Dale D. Buss. "Raising Minimum Wages: A Double-Edged Svrord." Area Development. Q2 2017). In California, the minimum wage went up 50 cents, to $10.50 per hour bcosting pay for 1.7 million people. Across the nation, about 4.3 million people received a raise because they earn less than the new minimum where they live, according to the Economic Policy Institute. As minimum wages rise across the United States, most of the affected jobs are low-wage positions in sectors such as quick-serve restaurants, retail stores, and hotels. The catch? Clearly a higher minimum wage benefits unskilled, low-pay workers by increasing their discretionary income and ultimately consumer spending, which is good for the economy. So why then is the minimum wage in the very center of the political debate? The reason is that the businesses that hire mostly unskilled workers earming the minimum wage will not be able to afford the same number of workers if they have to pay them a higher wage. To stay afloat, these businesses will either cut production or require special treatment from the state such as subsidies or tax exemptions. All of this will have a negative impact on the economy, and it's not immediately apparent whether the positive effect due to increased consumer spending will offset the negative effect due to reduced production and reduced government revenue. For example, consider the state of Illinois, which has been experiencing stagnant economic growth and needs to boost its economy. A recent editorial in the Chicago Tnibune (Editorial Board, "Stifling Growth in Illinois: Next Step, Raise the Minimum Wage Higher Than Every State's Border," Chicago Tribune, May 1. 2017) makes the following point: But in Baltimore, freshman Mayor Catherine Pugh protected her city's fragile economy by vetoing an ordinance in March that would have raised the minimum wage to S15 an hour by 2022. She said the ordinance, if enacted, would have made her city an outlier and less competitive with nearby cities and suburbs. She's taking mega heat for her veto. May we import her to Springfield? True or Falsei in a competitive labor market, increasing the minimum wage always raises the number of employed workers. O True