LR Question 10 Explanation
QUESTION TEXT: Columnist: Raising the minimum wage to the level recently proposed …
QUESTION TYPE: Necessary Assumption
CONCLUSION: Raising minimum wage to the proposed level will hurt, not help, low-income workers.
REASONING: Businesses will raise prices on necessary goods and services.
ANALYSIS: The columnist is saying that raising the minimum wage will lead businesses to raise prices due to higher costs. As a result, they claim that low-income workers will ultimately be worse off because essential goods will become even more unaffordable.
For this to be true, the harm from increased prices must outweigh the benefit of higher wages – otherwise, workers wouldn’t actually be worse off. Specifically, the argument assumes that the rise in prices is greater than the rise in wages.
If wages and prices increased by the same amount, workers’ purchasing power would stay the same. And if wages rose more than prices, workers would actually be better off. So, the correct answer must show that the wage increase does not fully offset the rise in costs.
___________
- The argument focuses solely on low-income workers, so high earners are out of scope.
- This is also out of scope. The columnist is concerned specifically with the effects of the proposed wage increase, not whether smaller increases would have different impacts.
- CORRECT. The argument assumes that the wage increase will not fully compensate for the price increases, meaning low-income workers will end up worse off. If this assumption were false – if the wage increase did fully compensate for price increases – the conclusion would fall apart.
- The reasoning in the argument doesn’t depend on a moral judgment about whether helping workers is desirable. It focuses on whether the proposed increase will actually help or hurt.
- We’re focused on the effect of this specific wage increase on the purchasing power of low-income workers, not the broader impact of minimum wage changes on the economy.
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