Reply To: 54-2-9

January 21, 2016 at 4:07 pm #1371

Good question to ask about…it’s one that gives a lot of students trouble, particularly distinguishing between A and C.  The argument relies on the notion that the minimum wage increase will (significantly) increase the museum’s operating expenses.  One way of looking at it to assume that everybody employed by the museum made $500,000 per year.  If that were the case, then the argument wouldn’t make much sense – Raising the minimum wage by 5%, from, say, $10/hour to $10.50/hour wouldn’t have any effect on the museum’s operating expenses if everyone made a ton more money than that.

Instead, what the argument needs to be the case is that there are people making minimum wage or close to it.  Using my numbers, let’s say the museum had 100 people making $10.20 per hour.  Now, when the minimum wage goes up to $10.50, we clearly have an increase in operating expenses – 30 more cents per hour, times 100 workers, times maybe 2,000 hours in a full-time year.  This is what the right answer is getting at – there are employees making so little that they’re affected by a minimum wage increase.