Your Boss Has Told You That You Will Receive an Increase

question 17

Multiple Choice

Your boss has told you that you will receive an increase in your salary next year.In response to this news,you would reduce your labour supply because

• A)the income effect would be equal to the substitution effect.
• B)the substitution effect would be stronger than the income effect.
• C)there would be an income effect but no substitution effect.
• D)there would be a substitution effect,but no income effect.

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Definitions:

Social Anxiety

A chronic mental health condition characterized by an intense fear of social situations and being negatively judged by others.

Eye Contact

The act of looking directly into another person's eyes, which can convey a range of emotions and social signals.

Negative Feedback

A process in which a system responds in a manner that reduces the effects of a change, aiming to maintain stability or equilibrium.

Overcome Shyness

The process of developing confidence in social situations, reducing the fear and anxiety associated with social interactions.