Which of the Following Statements Regarding Labor Supply Is False

question 145

Multiple Choice

Which of the following statements regarding labor supply is false?

• A)Jerry's labor supply curve can bend backward if the income effect of a higher wage rate outweighs the substitution effect.
• B)Bob's labor supply curve will not bend backward if the wage rate is never so high that the income effect outweighs the substitution effect.
• C)If there is a wage rate above which the income effect is at least as great as the substitution effect, the labor supply curve will be vertical or bend backward.
• D)The labor supply curve will slope upward if the income effect dominates the substitution effect.
• E)Hayden's offer to work more hours as the result of a wage increase suggests that the substitution effect dominates the income effect.