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Exhibit 12.2 -Refer to Exhibit 12.2,which Shows a Backward-Bending Labor Supply Curve

Question 48

Multiple Choice

Exhibit 12.2
Exhibit 12.2 -Refer to Exhibit 12.2,which shows a backward-bending labor supply curve for an individual.In the figure below,which of the following is true at a wage rate of $20? A) The income effect dominates the substitution effect. B) The substitution effect dominates the income effect. C) No labor is supplied. D) The income effect equals the substitution effect. E) The supply curve is horizontal.
-Refer to Exhibit 12.2,which shows a backward-bending labor supply curve for an individual.In the figure below,which of the following is true at a wage rate of $20?


A) The income effect dominates the substitution effect.
B) The substitution effect dominates the income effect.
C) No labor is supplied.
D) The income effect equals the substitution effect.
E) The supply curve is horizontal.

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