Summarize Argument: Phenomenon-Hypothesis
An Economist argues that increasing the minimum wage in Country X will quickly lead to a decrease in the country’s unemployment rate. This is because raising the minimum wage will increase people’s disposable income, which people will spend on consumer goods. This increase in demand will then lead to an increase in factory jobs to meet the demand for new goods.
Notable Assumptions
The Economist assumes that the number of jobs created by increasing demand will outpace the number of jobs lost by raising the minimum wage and that the cost of goods will not increase due to increasing the minimum wage.
A
The cost of a minimum-wage increase in Country X will be passed on to consumers in the form of significantly higher prices for consumer goods.
This weakens the author’s claim that the demand for goods will cause more factory workers to be hired. If prices rise, demand could potentially not increase to a level that would rapidly create more jobs to keep up with consumer demand.
B
Most of the consumer goods sold in Country X are produced outside the country.
This weakens the argument because most of the factory jobs created to keep up with demand would not come from *within* the country. Thus, the country’s unemployment rate would not rapidly decrease to the extent that the Economist predicts.
C
In many factories in Country X, most workers are paid much more than the current minimum wage.
This does not weaken the argument because it only addresses *one* industry in Country X. It is unclear how large this industry is. This does not weaken the author’s claim that raising the minimum wage would lead to more income for a large segment of the working population.
D
The cost to employers of an increase in the minimum wage in Country X will be made up by reductions in the workforce.
This weakens the argument because it undermines one of the Economist’s key assumptions: that the increase in factory jobs will outpace the number of job losses around the country. If this were true, then it is not likely that the unemployment rate would drastically decrease.
E
Most factories that produce consumer goods in Country X have large surpluses of goods as a result of years of overproduction.
This weakens the argument because if the factories have large surpluses, then they will not need to hire more workers to keep up with the demand for consumer goods.