How can we measure the opportunity cost of leisure? The opportunity cost of leisure is O A. economic discrimination. O B. the marginal product of labor. OC. a compensating differential. O D. the wage rate. O E. pure rent. The substitution effect of a wage increase O A. causes a worker to supply a larger quantity of labor, and the income effect causes a worker to supply a smaller quantity of labor. O B. causes a worker to supply a larger quantity of leisure, but the income effect causes a worker to supply a smaller quantity of leisure. OC. causes a worker to supply the same quantity of labor, and the income effect causes a worker to supply a smaller quantity of leisure. O D. causes a worker to supply a smaller quantity of labor, and the income effect causes a worker to supply a larger quantity of labor. Why is the supply curve of labor usually upward sloping? O A. As the wage increases, the opportunity cost of labor increases, causing individuals to devote more time to working. O B. As the wage decreases, purchasing power decreases, causing individuals to devote less time to working because leisure is an inferior good. OC. As the wage increases, purchasing power increases, causing individuals to devote less time to working because leisure is a normal good. O D. As the wage increases, the opportunity cost of leisure increases, causing individuals to devote more time to working. O E. As the wage increases, purchasing power increases, causing individuals to devote more time to working because leisure is a normal good.
How can we measure the opportunity cost of leisure? The opportunity cost of leisure is O A. economic discrimination. O B. the marginal product of labor. OC. a compensating differential. O D. the wage rate. O E. pure rent. The substitution effect of a wage increase O A. causes a worker to supply a larger quantity of labor, and the income effect causes a worker to supply a smaller quantity of labor. O B. causes a worker to supply a larger quantity of leisure, but the income effect causes a worker to supply a smaller quantity of leisure. OC. causes a worker to supply the same quantity of labor, and the income effect causes a worker to supply a smaller quantity of leisure. O D. causes a worker to supply a smaller quantity of labor, and the income effect causes a worker to supply a larger quantity of labor. Why is the supply curve of labor usually upward sloping? O A. As the wage increases, the opportunity cost of labor increases, causing individuals to devote more time to working. O B. As the wage decreases, purchasing power decreases, causing individuals to devote less time to working because leisure is an inferior good. OC. As the wage increases, purchasing power increases, causing individuals to devote less time to working because leisure is a normal good. O D. As the wage increases, the opportunity cost of leisure increases, causing individuals to devote more time to working. O E. As the wage increases, purchasing power increases, causing individuals to devote more time to working because leisure is a normal good.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:How can we measure the opportunity cost of leisure?
The opportunity cost of leisure is
O A. economic discrimination.
B. the marginal product of labor.
c. a compensating differential.
O D. the wage rate.
O E. pure rent.
The substitution effect of a wage increase
O A. causes a worker to supply a larger quantity of labor, and the income effect causes a worker to supply a smaller quantity of labor.
B. causes a worker to supply a larger quantity of leisure, but the income effect causes a worker to supply a smaller quantity of leisure.
C. causes a worker to supply the same quantity of labor, and the income effect causes a worker to supply a smaller quantity of leisure.
D. causes a worker to supply a smaller quantity of labor, and the income effect causes a worker to supply a larger quantity of labor.
Why is the supply curve of labor usually upward sloping?
O A. As the wage increases, the opportunity cost of labor increases, causing individuals to devote more time to working.
B. As the wage decreases, purchasing power decreases, causing individuals to devote less time to working because leisure is an inferior good.
C. As the wage increases, purchasing power increases, causing individuals to devote less time to working because leisure is a normal good.
D. As the wage increases, the opportunity cost of leisure increases, causing individuals to devote more time to working.
O E. As the wage increases, purchasing power increases, causing individuals to devote more time to working because leisure is a normal good.
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