What is the budget line for consumption (C) and leisure (L) if a person faces a constant wage of $10 per hour, there are 112 hours in the week to work, and she receives nonlabor income of $220 per week?

A. C = 1340
B. C ? 10L = 900
C. C + 10L = 1340
D. L = 10C + 220
E. 10C ? L = 900


Answer: C

Economics

You might also like to view...

What was the most important consequence of suburbanization?

A. It made people less dependent on their cars. B. It was very bad for the construction industry. C. It left the cities with large concentrations of poor people. D. It raised the tax bases of most cities.

Economics

The data in the table above shows the relationship between the Joneses' total consumption and total household income. Based on these data, total consumption varies

A) directly with their total household income. B) independently of their total household income. C) inversely with their total household income. D) negatively with their income.

Economics

Explain what will happen to the equilibrium real wage and quantity of labor for each of the following scenarios, and use a graph of the aggregate labor market to show the changes

a. The government decreases income tax rates. b. The skill level of workers increases. c. A hurricane destroys a large portion of the capital stock. d. Workers increase their preference of labor over leisure. e. A technological change occurs that increases the productivity of all workers, and at the same time the government increases income tax rates. f. The overall skill level of workers decreases, and at the same time household wealth increases.

Economics

Refer to the above figure. Medicare subsidies have increased the price of medical services to Ps. Which of the following statements is TRUE about the effect the Medicare subsidy has had on the consumption of medical services?

A) The amount of medical services provided has decreased from Q0 to Qd as a result of the subsidy. B) The amount of medical services provided has increased from Q0 to QM as a result of the subsidy. C) The amount of medical services provided has increased from Qd to QM as a result of the subsidy. D) The amount of medical services provided has remained unchanged as a result of the subsidy.

Economics