Which of the following measures the change in the hours of work that occurs when there is a change in income,other things equal?

Question

Quizplus · Accepted Answer

The income effect measures the change in the quantity of labor supplied in response to a change in income, holding other factors constant. As income increases, workers may choose to work more hours (if leisure is considered a normal good), leading to a positive income effect. Conversely, if income decreases, workers may choose to work fewer hours (since leisure is more valuable), leading to a negative income effect. The substitution effect measures the change in the quantity of labor supplied in response to a change in relative wages, holding other factors constant. The wage effect is not a recognized economic term. The supply of labor curve and marginal productivity are not relevant to measuring the change in hours of work in response to a change in income.

Which of the Following Measures the Change in the Hours