The Substitution Effect of an Increase in the Wage Rate

question 39

Multiple Choice

The substitution effect of an increase in the wage rate on the quantity of leisure demanded

• A)makes leisure more expensive which leads people to work more.
• B)makes leisure less expensive which causes people to work less.
• C)gives people more purchasing power and causes people to demand more leisure.
• D)gives people less purchasing power and so they will demand less leisure.

---

Definitions:

Reality

The state of things as they actually exist, outside of perception or belief.

Useful

pertains to something that serves a practical purpose or fulfills a need, offering utility or benefit.

Reality

Refers to the state of things as they actually exist, as opposed to how they may appear or might be imagined.

Socially Conscious

Being aware of and responsive to societal and social issues and injustices.