Multiple Choice
In most states,there is a mandatory maximum number of children allowed per day care worker.If this maximum number is binding,then,if the wage of day care workers goes up,the main effect on day care employment will be
A) through the scale effect.
B) through the substitution effect.
C) equally shared between the substitution and scale effect.
D) through neither the scale nor the substitution effect, as labor demand will not change.
Correct Answer:

Verified
Correct Answer:
Verified
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