With respect to labor supply, the substitution effect means a
A) person increases his or her hours of labor in response to a higher wage rate.
B) person decreases his or her hours of labor in response to a higher wage rate.
C) person substitutes high paying work for low paying work.
D) firm substitutes capital for labor.
A
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In a competitive market with no externalities,
A) the consumer surplus is equal to zero because of competition. B) buyers cannot control the price, so the consumer surplus is zero. C) at the equilibrium price, marginal benefit exceeds marginal cost. D) at the equilibrium price, marginal benefit equals marginal cost. E) at the equilibrium price, the total amount of consumer surplus equals the total amount of producer surplus.
Which of the following groups of people would be included in the official unemployment rate?
a. part-time workers b. workers temporarily laid off from jobs to which they expect to return c. discouraged workers d. all of the above