Problem 3

Introduction

Price floor is a situation when the price charged is more than or less than the equilibrium price determined by market forces of demand and supply. ... Price floor leads to a lesser number of workers than in case of equilibrium wage. Whereas, A living wage is defined as the minimum income necessary for a worker to meet their basic needs. This is not the same as a subsistence wage, which refers to a biological minimum. Needs are defined to include food, housing, and other essential needs such as clothing.