Barry's Wage Increased and He Responded by Working More Hours

question 35

Multiple Choice

Barry's wage increased and he responded by working more hours. Which of the following must be true?

• A) Leisure is an inferior good.
• B) The substitution effect of the wage increase dominated the income effect.
• C) The income effect of the wage increase dominated the substitution effect.
• D) The substitution and income effect both increased hours of work.

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