Multiple Choice
Which of the following statements is true?
A) The slope of the labor supply curve depends only on the income effect of a wage rate change.
B) The income effect and the substitution effect of a change in wage rate work in the same direction.
C) The income effect and the substitution effect of a change in wage rate work in opposite directions.
D) The slope of the labor supply curve depends only on the substitution effect of a wage rate change.
Correct Answer:
Verified
Correct Answer:
Verified
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