The trade-off between work and leisure underlying the supply of labour involves the substitution effect and the _____ effect.

Question

Quizplus · Accepted Answer

The other options do not fit the context of the relationship between work and leisure. The income effect refers to changes in the supply of labour when income changes. The substitution effect is the change in the supply of labour when the wage rate changes.

The Trade-Off Between Work and Leisure Underlying the Supply of Labour