Multiple Choice
Lisa works 46 hours a week at a wage of $10 an hour.If her wage increases to $16.50, then:
A) the substitution effect implies that she will work less.
B) if leisure is a normal good, the income effect implies that she will work less.
C) if leisure is a normal good, the income effect will reinforce the substitution effect and she will work less.
D) Lisa's marginal product of labor has decreased.
Correct Answer:

Verified
Correct Answer:
Verified
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