The income effect on labour supply is positive.

Name: The income effect on labour supply is positive.
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Question

Quizplus · Accepted Answer

The income effect on labour supply is negative, meaning that as one's income increases, they may choose to work less in order to enjoy more leisure time. This is in contrast to the substitution effect, where a higher wage rate incentivizes individuals to work more in order to earn more income.

The Income Effect on Labour Supply Is Positive