This figure depicts a model of labour supply and consumption for the US in 1900 and 2013. The wage rate is shown to have increased between the two years. Which of the following are true? (Ignore the dashed orange line) IC Consumption ($) 300 225 150 75 0 8 10 12 16₂ 14 D 16 18 Hours of free time 20 a. The income effect dominates the substitution effect, leading to a reduction in the hours of work. b. According to this model, Americans work more and consume more in 2013 than in 1900 c. The substitution effect dominates the income effect, leading to an increase in the hours of work. d. According to this model, Americans consume more and enjoy more free time in 2013 than in 1900 22 24

This figure depicts a model of labour supply and consumption for the US in 1900 and 2013. The wage rate is shown to have increased between the two years. Which of the following are true? (Ignore the dashed orange line) IC Consumption ($) 300 225 150 75 0 8 10 12 16₂ 14 D 16 18 Hours of free time 20 a. The income effect dominates the substitution effect, leading to a reduction in the hours of work. b. According to this model, Americans work more and consume more in 2013 than in 1900 c. The substitution effect dominates the income effect, leading to an increase in the hours of work. d. According to this model, Americans consume more and enjoy more free time in 2013 than in 1900 22 24

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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PLEASE ANSWER QUESTION 3
4. Winona has 80 hours to divide between leisure and labor. Her utility function is u(r,c) = f(r) + c, when r represents hours of leisure, c represents dollars of consumption, and fis strictly concave. Winona's wage is wo = $15/hr. initially, then it rises to wi = $20/hr. (i) Explain what happens to Winona's labor supply when the wage rises, and why. (ii) Explain how the answer to (i) would change if Winona were to win a lottery.
Can you please help solve question 10 a,b and c please show full working so I can compare it to my own work Thank you
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Please help me to solve question 6 d. I am having a little bit of trouble understanding it. Thank you