A. will have no effect on labour supply
B. will decreases labour supply
C. could cause either an increases or a decrease in labour supply
D. will increase labour supply.
Related Mcqs:
- The income effect of a price increase of a normal good is to ________ of that good and the substitution effect is to _________ of that good?
A. increase quantity demanded, reduce quantity demanded
B. increase quantity demanded, increases quantity demanded
C. reduce quantity demanded, reduce quantity demanded
D. reduce quantity demanded, increase quantity demanded - If leisure is a normal good, an increase in the wage ?
A. will always increase the quantity of labor supplied
B. will increase the amount of labor supplied if the substitution effect outweighs the income effect
C. will increase the amount of labor supplied if the income effect outweighs the substitution effect
D. will always decrease the amount of labor supplied - Assuming that leisure is a normal good. if an individual’s labour supply curve is backward bending then the ?
A. income effect is zero
B. substitution effect outweighs the income effect
C. income effect outweighs the substitution effect
D. income effect and the substitution effects are equal - If the income effect is smaller than the substitution effect, higher net wages will ?
A. reduce the supply of labour.
B. increase the demand for labour
C. increase the supply of labour
D. have no effect on the supply of labour - The substitution effect of higher wages suggests that as the wage rate increases ?
A. leisure becomes less expensive and households buy more of it
B. leisure becomes more expensive and households buy more of it
C. leisure becomes more expensive and households buy less of it
D. leisure becomes less expensive and households buy less of it. - As the wage rate per hour increases, the opportunity cost of leisure ?
A. remains constant
B. increases since the cost of forgoing one hour of work increases
C. decreases since the customer now has more income to spend
D. may increase of decrease depending on the individual’s preferences. - The government increase the minimum wage. The National Association of Fast Food Restaurants hires you to determine the impact that this higher minimum wage will have on it industry. This is an example of ?
A. industry equilibrium analysis
B. specific equilibrium analysis
C. partial equilibrium analysis
D. general equilibrium analysis - Refer to Exhibit 4, Suppose that the consumer must choose between buying socks and belts Also suppose that the consumer’s income is €100 Suppose that the price of a pair of socks falls from €5 to €2 The substitution effect is represented by the movement from point ?
A. Z to point X
B. X to point X
C. X to point Z
D. Y to point X - The substitution effect of a rise in the price of labour will ____ the quantity of labour and the output, effect will ____ it
A. increase; increase
B. increase; reduce
C. reduce; reduce
D. reduce; increase - An increase in the minimum wage will cause a relatively large increase in unemployment among ?
A. unskilled workers if the demand for labour is relatively inelastic
B. unskilled workers if the demand for labour is relatively elastic
C. skilled workers if the demand for labour is relatively elastic
D. skilled workers if the demand for labour is relatively inelastic
