The labor supply could decrease when wages increase only if the:
A. price effect outweighs the income effect.
B. substitution effect outweighs the income effect.
C. income effect outweighs the price effect.
D. price effect outweighs the substitution effect.
Answer: C
You might also like to view...
The condition, MRS1,C = w, describes the representative consumer's
A) investment decision. B) consumption - savings decision. C) current period work - leisure decision. D) future period work - leisure decision.
A defendant believes there is a 70 percent chance that the plaintiff will win $800,000 and a 30 percent chance that the plaintiff will lose and be awarded nothing (zero). The plaintiff believes that there is a 90 percent chance that they will win $800,000 and a 10 percent chance that they will be awarded nothing (zero). The plaintiff's litigation cost is $300,000 and the defendant's litigation
cost is $200,000. The defendant would be willing to pay any amount up to ________ to settle. A) $760,000 B) $700,000 C) $420,000 D) $500,000
If U.S. prices increase relative to the rest of the world, we would expect:
A. net exports to increase. B. net exports to decrease. C. net exports to be unaffected. D. government spending to increase.
If an increase in inflation is expected, which of the following events is the least likely to occur?
a. There will be an upward movement along the long-run Phillips curve. b. Nominal GDP will increase. c. Nominal wage rates will increase at the same rate as expected inflation. d. A worker's reservation wage will rise at the same rate as expected inflation. e. Unemployment rate will increase.