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In the Backward-Bending Portion of a Labor Supply Curve

Question 52

Multiple Choice

In the backward-bending portion of a labor supply curve:


A) a worker will increase the quantity of labor supplied in response to an increase in the wage.
B) the substitution effect of a wage change outweighs the income effect.
C) the income effect of a wage change outweighs the substitution effect.
D) the substitution effect of a wage change equals the income effect.

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