The Figure Given Below Shows a Backward-Bending Labor Supply Curve

question 135

Multiple Choice

The figure given below shows a backward-bending labor supply curve for an individual. In the figure below, which of the following is true if the wage rate decreases from $14 to $6 per hour? ​
Figure 12.2
​

• A)The income effect dominates the substitution effect.
• B)The substitution effect dominates the income effect.
• C)No labor is supplied.
• D)The income effect equals the substitution effect.
• E)The supply curve is horizontal.

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Definitions:

Property

Legal rights or interests that allow the ownership, use, and control of assets like land, buildings, or personal items.

James Madison

An American statesman, diplomat, expansionist, philosopher, and Founding Father who served as the fourth President of the United States from 1809 to 1817, known as the "Father of the Constitution" for his pivotal role in drafting and promoting the U.S. Constitution.

Anti-Federalists

Individuals or groups who opposed the adoption of the U.S. Constitution, advocating for a weaker central government in favor of stronger state governments.

Patrick Henry

was an American attorney, planter, and orator best known for his declaration to the Second Virginia Convention (1775): "Give me liberty, or give me death!"