Aaron works in a plumbing supply store and has just been promoted to manager, giving him a nice raise in salary. The substitution effect of a higher wage will lead him to:

Question

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The substitution effect of a higher wage implies that Aaron will now earn more money per hour worked, making work more attractive relative to leisure. Therefore, he is likely to supply more hours of labor to take advantage of the higher wage.

Aaron Works in a Plumbing Supply Store and Has Just