How can I show the impact of a NMW on employment using a supply and demand graph?

You'd need to draw your pair of axes, labelling the vertical one "wages" and the horizontal one "quantity of workers". Your labour demand and supply curves should look like normal demand and supply curves. The National Minimum Wage (NMW) would be a horizontal line above the equilbrium point. This NMW intersects twice with the pair of axes, the distance between both intersections is your excess labour supply - i.e. the number of unemployed workers in this economy.

MG

Related Economics A Level answers

All answers ▸

What is the opportunity cost of a good?


I have revised all the content for Economics but my essays are not reaching the top level, what can I do to ensure I get the highest marks?


Outline and evaluate the economic effects of a fall in the value of the dollar?


Explain two causes of inflation using AD/AS analysis.