Then consider an individual with the exact same indifference curve map as in the previous question) and skills, this person happened to have a better connection with a com and is earning a higher wage than the individual in part 'a'. Thu this person faces budget line BL' below and takes l'hours of leisure (works T - l'hours).

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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Then consider an individual with the exact same preferences (same
indifference curve map as in the previous question) and skills, but
this person happened to have a better connection with a company
and is earning a higher wage than the individual in part 'a'. Thus,
this person faces budget line BL' below and takes l'hours of
leisure (works T - l'hours).
C
50
BL
l'
O Keep leisure the same
T
Then this individual is offered the same take-it-or-leave-it (TIOLI)
cash grant of $g (that must be forgone if this person works at all).
What would this individual do (in terms of leisure taken (and labor
supplied))?
O Take no leisure
151515
O Take more leisure, but not as much at T.
ولا
O Take all leisure (not work at all)
O None of the other options.
Transcribed Image Text:Then consider an individual with the exact same preferences (same indifference curve map as in the previous question) and skills, but this person happened to have a better connection with a company and is earning a higher wage than the individual in part 'a'. Thus, this person faces budget line BL' below and takes l'hours of leisure (works T - l'hours). C 50 BL l' O Keep leisure the same T Then this individual is offered the same take-it-or-leave-it (TIOLI) cash grant of $g (that must be forgone if this person works at all). What would this individual do (in terms of leisure taken (and labor supplied))? O Take no leisure 151515 O Take more leisure, but not as much at T. ولا O Take all leisure (not work at all) O None of the other options.
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