Acme Market increased wages for their cashiers from $7/hr to $9/hr.Pat,a cashier at Acme,now works 30hrs/week instead of the 25hrs/week hours Pat used to work before the wage increase.On the other hand Chris,also a cashier at Acme decreased his work time by 5hrs/week after the wage increase and started to spend more time watching TV.
Chris's behavior can be best explained as the _______ of high wage rates.

Question

Quizplus · Accepted Answer

Chris is experiencing the income effect, where his increase in wage allows him to afford the luxury of working less and spending more time watching TV.

Acme Market Increased Wages for Their Cashiers from $7/hr to $9/hr.Pat,a