The Backward Bending Portion of an Individual Labour Supply Curve

question 83

Multiple Choice

The backward bending portion of an individual labour supply curve is indicative of:

• A)a desire to increase work effort (hours) as wage rate rises
• B)dominant income effects at higher levels of income
• C)dominant income effects at lower levels of income
• D)a desire to reduce work effort (hours) as wage rate falls

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Definitions:

Variable Costs

Costs that vary directly with the level of production or output, such as materials and labor.

Cost of Goods Manufactured

The total production cost of goods completed and moved out of work-in-process inventory during a period, including labor, materials, and overhead.

Units Manufactured

The total number of units produced by a manufacturing process within a specific period.

Net Income

The total earnings of a company after subtracting all expenses, including taxes and operating costs, from its total revenues.