A worker has preferences given by the utility function U(N, Y) = N " Y where N is the hours of leisure per day and Y is their spending on purchased goods. 13. If the consumer faces a wage rate of w=30, how much leisure and purchased goods do they consume? What is the quantity of labor supplied? 14. Suppose the wage increases to w=40. What is the quantity of labor supplied?
A worker has preferences given by the utility function U(N, Y) = N " Y where N is the hours of leisure per day and Y is their spending on purchased goods. 13. If the consumer faces a wage rate of w=30, how much leisure and purchased goods do they consume? What is the quantity of labor supplied? 14. Suppose the wage increases to w=40. What is the quantity of labor supplied?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:A worker has preferences given by the
utility function U(N, Y) = N " Y where N is
the hours of leisure per day and Y is their
spending on purchased goods. 13. If the
consumer faces a wage rate of w=30,
how much leisure and purchased goods
do they consume? What is the quantity of
labor supplied? 14. Suppose the wage
increases to w=40. What is the quantity
of labor supplied?
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