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When Wages Increase, the Income Effect of Labor Supply ________

Question 63

Multiple Choice

When wages increase, the income effect of labor supply ________ the quantity of labor supplied because ________.


A) reduces; the price of leisure has increased
B) reduces; workers acquire more of all normal goods (including leisure) when income increases
C) increases; the value of working has increased
D) increases; the price of leisure has increased

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