Consider an Individual Whose Income Increases Substantially

question 87

Multiple Choice

Consider an individual whose income increases substantially.This allows him to increase consumption of all normal goods and services.If he increases the consumption of leisure,it implies that:

• A)the substitution effect of a wage increase is larger than the income effect.
• B)the labor supply curve is upward sloping at all wage rates.
• C)he is on the backward bending portion of the labor supply curve.
• D)the labor supply curve is downward sloping at all wage rates.

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Definitions:

Friedman Test

A non-parametric statistical test used to compare three or more matched or paired groups across multiple test conditions or times, assessing differences in rankings.

Ordinal Data

A type of categorical data that has a meaningful order or ranking among the categories but not a measurable distance between them.

Significance Level

A threshold in hypothesis testing that determines the probability of rejecting the null hypothesis when it is actually true, typically denoted by alpha.

Kruskal-Wallis Test

A nonparametric method for testing whether samples originate from the same distribution, often used when comparing three or more groups.