Figure 20-3 Figure 20-3 Shows a Worker's Backward-Bending Supply Curve of Labor

Figure 20-3

Figure 20-3 shows a worker's backward-bending supply curve of labor. Which of the following statements is correct?

A) The substitution effect of a change in the wage dominates the income effect at all points on the curve.
B) The income effect of a change in the wage dominates the substitution effect at all points on the curve.
C) Above W*, the substitution effect of a change in the wage dominates the income effect; below W*, the income effect dominates the substitution effect.
D) Above W*, the income effect of a change in the wage dominates the substitution effect; below W*, the substitution effect dominates the income effect.