The average work week in the United States has declined to fewer than 40 hours even though wage rates have been increasing. The best explanation of this phenomenon is that
a. the labor supply curve shifted to the right
b. the labor demand curve shifted to the right
c. the income effect of rising wages outweighed the substitution effect
d. the income effect of rising wages could not outweigh the substitution effect
e. none of the above
C
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Recently the price of lentil beans increased. As a result Lincoln residents noticed that their neighbor, Rasputin, increased his consumption of lentils and decreased his consumption of steak. Rasputin said his utility had declined. Many citizens made donations to the "Rasputin Relief Fund." Rasputin was given a cash grant equal to the amount he claimed to need to regain his initial utility level. Happy and thankful, Rasputin rushed off to the store to make his new purchases. Each graph above shows two indifference curves for Rasputin, I1 and I2, and the two budget constraints, B1 and B2, that he faced. Let E1 represent Rasputin's initial equilibrium, E2 equal his equilibrium following the increase in the price of lentils, E3 his equilibrium after receiving the cash from the relief fund. Wh
A. Graph A
B. Graph B
C. Graph C
D. Graph D
Consider two scenarios for a nation's economic growth. Scenario A has real GDP growing at an average annual rate of 2%; scenario B has an average annual growth of 8%. The nation's real GDP would double in about
A. 36 years under scenario A, versus 18 years under scenario B. B. 18 years under scenario A, versus 9 years under scenario B. C. 36 years under scenario A, versus 9 years under scenario B. D. 25 years under scenario A, versus 12.5 years under scenario B.