If Sara receives a pay increase from $15 to $16 an hour and she chooses to

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When Sara receives a pay increase, the substitution effect is that the opportunity cost of leisure time increases, making leisure relatively more expensive compared to working. Therefore, she may choose to work more hours. On the other hand, the income effect is that Sara's purchasing power increases, making her relatively wealthier, and she may choose to work less and enjoy more leisure time. However, since Sara values leisure time as a normal good, the income effect will be weaker than the substitution effect. Therefore, if Sara chooses to work more, the substitution effect for leisure demand is stronger than the income effect. Thus, option D is the correct choice.

If Sara Receives a Pay Increase from $15 to $16