If income is held constant and the wage rate increases,the desired hours of work will

Name: If income is held constant and the wage rate increases,the desired hours of work will
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Question

Quizplus · Accepted Answer

The income effect will cause the desired hours of work to decrease, while the substitution effect will cause the desired hours of work to increase. Since the income effect is stronger than the substitution effect, the overall effect will be a decrease in the desired hours of work.

If Income Is Held Constant and the Wage Rate Increases,the