For an Individual's Supply Curve of Labor to Be Backward

question 152

Multiple Choice

For an individual's supply curve of labor to be backward bending:

• A) the substitution effect must be greater than the income effect.
• B) the substitution effect must be equal to the income effect.
• C) the substitution effect must be less than the income effect.
• D) is an impossibility.

---

Definitions:

Impairment

A decrease in the recoverable value of an asset below its carrying amount on the balance sheet, necessitating a write-down of its value.

Fair Value

An estimate of the price at which an asset or liability would trade in a fair transaction between willing parties.

Useful Life

The estimated period over which an asset is expected to be useful in the operations of a business.