Contemporary Labor Economics 9th Edition by Campbell Mcconnell, Stanley Brue, David Macpherson, Robert Powell, David Colander

Exercise 12

Evaluate the following statements:
a. "An employer might reduce worker absenteeism by changing from a standard wage rate to premium pay for hours that exceed a fixed minimum."
b. "A worker who feels underemployed may moonlight even though the wage rate is somewhat lower than the one paid in the worker's first job."
c. "Given the wage rate, an individual will always prefer a job in which the worker, as opposed to the employer, selects the number of hours worked."
d. "If at all points within the work-leisure diagram a person's indifference curves are flatter than the budget constraint, then that individual will choose to be a nonparticipant."
e. "The income effect of any given wage increase is larger for individuals who are currently working many hours than it is for those who are currently working few or no hours."