draw James leisure demand curve. Which effect, substitution or income, is larger for him? James' leisure demand curve is [Select] SE is [ Select] v than IE draw Xiao's leisure demand curve. Which effect, substitution or income, is larger for him? Xiao's leisure demand curve is [Select]

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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E2

Two individuals, James and Xiao, derive utility from leisure and other goods. To maximise utility, th
allocate 24 hours in the day between work (for which they can earn wage w) and leisure. The prici
other goods is $1. Given the following information:
James
Xiao
price
other
other
of wage leisure
OG
leisure
goods
goods
$1
$30
17
210
14
300
$1
$40
16
320
15
360
$1
$50
15
450
16
400
a) draw James' leisure demand curve. Which effect, substitution or income, is larger for him?
• James' leisure demand curve is [Select ]
• SE is [ Select]
v than IE
b) draw Xiao's leisure demand curve. Which effect, substitution or income, is larger for him?
• Xiao's leisure demand curve is [Select]
• SE is [ Select]
than IE
Transcribed Image Text:Two individuals, James and Xiao, derive utility from leisure and other goods. To maximise utility, th allocate 24 hours in the day between work (for which they can earn wage w) and leisure. The prici other goods is $1. Given the following information: James Xiao price other other of wage leisure OG leisure goods goods $1 $30 17 210 14 300 $1 $40 16 320 15 360 $1 $50 15 450 16 400 a) draw James' leisure demand curve. Which effect, substitution or income, is larger for him? • James' leisure demand curve is [Select ] • SE is [ Select] v than IE b) draw Xiao's leisure demand curve. Which effect, substitution or income, is larger for him? • Xiao's leisure demand curve is [Select] • SE is [ Select] than IE
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