Sadie works at a factory for $15 an hour and typically works 40 hours a week. Sadie gets a pay raise and now earns $20 an hour. She decides to work 45 hours a week at $20 an hour. Her response to the pay increase demonstrates the:
A. labor effect outweighing the price effect.
B. price effect outweighing the income effect.
C. income effect outweighing the price effect.
D. income effect outweighing the substitution effect.
Answer: B
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