The substitution effect of higher wages suggests that, as the wage rate increases, leisure becomes
A) less expensive and households choose more of it.
B) more expensive and households choose more of it.
C) more expensive and households choose less of it.
D) less expensive and households choose less of it.
Correct Answer:
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Q2: When economists assume perfect markets for inputs,
Q3: When economists assume perfect markets for inputs,
Q4: Which of the following changes has occurred
Q5: If input markets were perfectly competitive, income
Q6: Which of these is not a determinant
Q8: Economists call the sacrifice involved in working
Q9: As the wage rate per hour increases,
Q10: Assuming leisure is a normal good, if
Q11: If the income effect is smaller than
Q12: The elasticity of supply of labour will
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