Which One of the Following Statements Regarding the Intertemporal Substitution

question 11

Multiple Choice

Which one of the following statements regarding the intertemporal substitution hypothesis is false?

• A) Workers are willing reduce labor supplied during a recession.
• B) Increases in unemployment may be voluntary as workers collect unemployment insurance benefits.
• C) Increases in unemployment may be voluntary as workers trade income for leisure during low-wage periods.
• D) Wages and hours of leisure will tend to move together over the course of the life-cycle.
• E) Labor supply responds to changes in the real wage.

---

Definitions:

"g" Factor

The general intelligence factor believed to underlie specific mental abilities and talents.

General

Pertaining to or affecting all or most people, places, or things; widespread.

Spearman's "g" Factor

A theory proposed by Charles Spearman that suggests human intelligence is a single general cognitive ability that can be measured and quantitatively expressed.

Early IQ Tests

Early IQ tests were assessments developed to measure intellectual abilities and potential, often criticized for their cultural and socioeconomic biases.