Luke was earning $60 per hour and working 40 hours per week. Luke's wage rose to $70 per hour, and as a result, he now works 50 hours per week
What can you conclude from this information about the substitution and income effects of a wage increase for Luke?
We can conclude that Luke's substitution effect is greater than his income effect, since the increase in wages led to an overall increase in the number of hours worked.
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Russia borrowed funds from the International Monetary Fund in 1989 in exchange for agreeing to undertake certain changes. However, after receiving the funds, Russia spent the funds on other things, making the loan repayment more unlikely to occur
This situation is referred to as A) asymmetric information. B) deceptive knowledge. C) moral hazard. D) adverse selection.
Cap-and-trade refers to
A) capping emissions and issuing tradeable emissions permits. B) capping revenue from selling emissions permits. C) countries trading fishing rights in international waters. D) capping taxes on firms that engage in international trade. E) capping the benefits gained from pollution controls.