An Increase in the Wage Rate Will

question 116

Multiple Choice

An increase in the wage rate will:

• A) normally generate a small income effect.
• B) generate a significant decrease in after-tax income.
• C) possibly lead people to choose more leisure rather than work more, since leisure is a normal good.
• D) cause businesses to increase the number of employees to reduce costs.

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Definitions:

Repair Expenses

Costs associated with fixing or restoring equipment, property, or goods to their original condition.

Financial Incentives

Monetary benefits used to motivate specific behaviors or actions among employees, customers, or other stakeholders, typically aiming at increasing sales, productivity, or engagement.

Customer Relationships

The interactions and engagements a company has with its customers, with the aim of improving loyalty and satisfaction.

Business Markets

Commercial sectors that involve transactions between businesses rather than between a business and a consumer.