Because Leisure Is a Normal Good,an Increase in Income _____

question 12

Multiple Choice

Because leisure is a normal good,an increase in income _____

• A)decreases the demand for leisure time and reduces the amount of time allocated to market work.
• B)decreases the demand for leisure time and increases the amount of time allocated to market work and nonmarket work.
• C)increases the demand for leisure time and reduces the amount of time allocated to market work and nonmarket work.
• D)increases the demand for leisure time and increases the amount of time allocated to market work and nonmarket work.
• E)has no impact on the demand for leisure time.

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Definitions:

Cost of Capital

The cost of funds used for financing a business, typically considered as the weighted average of the costs of equity and debt financing.

Tax Rate

The amount of tax a person or company must pay, expressed as a percentage of income.

Optimal Level

The most efficient, effective, or desirable point or degree for a specific outcome or condition.