The assumption that current-period labor supply is positively related to the current-period real wage is justified as long as the
A) income effect dominates the substitution effect in the short run.
B) income effect dominates the substitution effect in the long run.
C) substitution effect dominates the income effect in the short run.
D) substitution effect dominates the income effect in the long run.
C
You might also like to view...
The income effect explains why there is an inverse relationship between the price of a product and the quantity of the product demanded
Indicate whether the statement is true or false
Which of the following statements best depicts laypeople's explanation of the Great Depression at that time?
A. Unions were keeping the good jobs for themselves. B. An oversupply of goods had glutted the market. C. Government policies kept prices too high. D. An oversupply of goods is impossible.
The figure below represents the effects in the labor markets due to migration. Here, the world has been divided into a high-income "North" (left panel) and a low-income "South" (right panel). Dn and Sn are the labor demand and the labor supply curves in North. Ds and (Sr + Smig) are the labor demand and pre-migration labor supply curves in South. Sr is the post-migration labor supply curve in South. The value c is the cost of migrating.
The migration cost on a per hour basis is
A. $2.50. B. $1.25. C. $4.25. D. $6.75.
Which of the following is best characterized as a public? good?
A. A church B. Police protection C. Primary education D. A public library