Statement I: According to the Theory of the Backward-Bending Labor

question 91

Multiple Choice

Statement I: According to the theory of the backward-bending labor supply curve,the substitution effect and the income effect work in opposite directions.
Statement II: The theory of the backward-bending labor supply curve has no validity in real life because it assumes that money is the only factor that motivates us to work.

• A)Statement I is true and statement II is false.
• B)Statement II is true and statement I is false.
• C)Both statements are true.
• D)Both statements are false.

---

Definitions:

X-Intercepts

The points where a graph intersects the x-axis, representing the values of x when the function or equation equals zero.

Graph

An illustration showing the web of interactions or relationships between multiple elements using unique markers such as dots, lines, and bars.

Perpendicular

Lines or planes that intersect at a right angle (90 degrees).

Parallel

Lines or planes that are the same distance apart over their entire length and never meet.