In a market for labour's demand and supply, the equilibrium wage is w*. The government fixes a minimum wage at w'. Which of the following statements is true?
1
There is a tendency of increased casualization of workers if w' > w*, where the workers would not receive lots of benefits.
2
The market will now tend towards a new equilibrium at w', with no other changes, if w' > w*.
3
If w' < w*, there will be a tendency of increased casualization of workers.
4
It will be impossible to administer such a legislation unless w' = w*.