Shel and Fran are neighbors. They work at the same firm and hold the same title. Shel finds that when Fran's consumption rises, Shel feels worse off. Fran feels the same way about Shel's consumption. Suppose the firm that employs both Fran and Shel begins to offer one hour of overtime at 1.5 times their base hourly wage. It is likely that:
A)Fran will work more but not Shel.
B)Shel will work more but not Fran.
C)neither Fran nor Shel will work more.
D)both Fran and Shel will work more.

Question

Quizplus · Accepted Answer

Fran and Shel base their happiness on their relative position and each prefers to have more things than the other. If one observes the other working more and earning more money, the other will feel compelled to do the same.

Shel and Fran Are Neighbors