The Labour Supply Curve May Eventually Become "Backward Bending" at High

question 16

Multiple Choice

The labour supply curve may eventually become "backward bending" at high wages because

• A)the substitution effect on the demand β₁ leisure dominates the income effect.
• B)the income effect on the demand β₁ leisure dominates the substitution effect.
• C)firms demand added productivity from the workers as the wage reaches very high levels.
• D)at high wage rates,the reservation wage rate rises.
• E)people get tired of working so many hours and refuse to increase their labour supply.

---

Definitions:

Recursive Functions

Functions that call themselves within their own definition, often used for tasks that can be broken into similar subtasks.

Iterative Solution

A method of solving a problem by repeatedly applying a set of operations until a certain condition is met, typically used in loops and iterations.

Declaration Statement

A statement in programming that declares a new variable or function, specifying its type and, optionally, initializing it.

Function Body

The section of a function in a program that contains the actual statements that execute when the function is called.