National Minimum Wage
Lowest legal wage employers must pay employees.
Formula
NMW = Minimum hourly rate set by government
Real World
When the UK's National Living Wage rose to £11.44/hour in April 2024, supermarkets like Tesco faced millions in extra wage costs, pressuring profit margins.
Exam Focus
Evaluate both sides: NMW raises worker income and motivation but increases business costs — always conclude with the net effect on the specific business.
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