If Alex seeks to maintain a constant income level, and all workers in his industry, including...

If Alex seeks to maintain a constant income level, and all workers in his industry, including Alex, get a wage increase, which of the following will always be true?

A)The market supply of labor curve will be backward bending for Alex's type of work

B)The income effect of the raise causes Alex to work more

C)Alex will have a backward bending supply curve for his labor

D)The substitution effect of the wage increase leads to less work

Expert Solution

When wage rate is increased, substitution effect would encourage Alex to work more and less leisure because the opportunity cost of leisure is increased. However, income effect of a wage increase would encourage more leisure and less work. Since Alex seeks to maintain a constant income level, when wage rate is increased, he would work less so that income is not increased. Hence, Alex must face a backward bending supply curve for his labor since higher wage induces him to work less.

Option C is correct

Rahul Sunny answered 2 years ago

The human body is very complex and seeks to maintain a constant internal environment. This state...

The human body is very complex and seeks to maintain a constant internal environment. This state of dynamic equilibrium is called homeostasis. Some diseases such as diabetes can impact the body's ability to maintain homeostasis. To maintain a relatively constant internal environment, the human body uses negative and positive feedback. 1. As a medical professional, how would you explain the role negative and positive feedback plays in maintaining homeostasis to a newly diagnosed diabetic patient?

Question 15 According to a union agreement, the mean income for all senior-level workers in a...

Question 15 According to a union agreement, the mean income for all senior-level workers in a large service company equals $500 per week. A representative of a women's group decides to analyze whether the mean income for female employees matches this norm. The data for a random sample of 9 female employees are given below: 337, 412, 508, 455, 481, 523, 396, 368, 408 Test, at significance level 0.05, that the mean income for all female employees in this company...

According to a labor union contract, the mean income for all senior-level assembly-line workers in a...

According to a labor union contract, the mean income for all senior-level assembly-line workers in a large company must be $520 per week. Women who work for the company think that men workers are being paid more than the standard set in the labor contract. A representative of a women’s group decides to test this claim about the mean income µ for men employees, using α = .05. In a random sample of nine men workers, she finds that the...

According to a labor union contract, the mean income for all senior-level assembly-line workers in a...

According to a labor union contract, the mean income for all senior-level assembly-line workers in a large company must be $520 per week. Women who work for the company think that men workers are being paid more than the standard set in the labor contract. A representative of a women’s group decides to test this claim about the mean income µ for men employees, using α = .05. In a random sample of nine men workers, she finds that the...

A production manager wants to assess the reactions of the blue-collar workers in his department (including...

A production manager wants to assess the reactions of the blue-collar workers in his department (including foremen) to the introduction of computer-integrated manufacturing (CIM) systems. He is particularly interested in finding out how they perceive the effects of CIM on: 1. their future as employees 2. the additional training that they will have to receive 3. future job advancement

QUESTION ONE A Consumer seeks to maximize a utility function Ux,y subject to his income constraint...

QUESTION ONE A Consumer seeks to maximize a utility function Ux,y subject to his income constraint given by: P1x+P2y=M. What is meant by a duality problem in constrained optimization? Please provide examples. [6 marks] Set up a Lagrange function for this optimization. [3 marks] State the First order conditions and explain how you would solve for the critical values. [6 marks] Explain the meaning of the Lagrange multiplier as it related to this optimization problem. [4 marks]...

1)progressive income tax is one that A.taxes income at a constant rate, regardless of the level...

1)progressive income tax is one that A.taxes income at a constant rate, regardless of the level of income. B.taxes income so that the average tax rate increases with the level of income. C.taxes all income above the guaranteed minimum at an average rate that decreases with income. D.taxes income so that the average tax rate decreases with the level of income. 2)An income tax for which the average tax rate decreases with income is called a A.flatminus−rateincome tax. B.regressive income...

Question

If Alex seeks to maintain a constant income level, and all workers in his industry, including...

Solutions

Expert Solution

Related Solutions

The human body is very complex and seeks to maintain a constant internal environment. This state...

Question 15 According to a union agreement, the mean income for all senior-level workers in a...

According to a labor union contract, the mean income for all senior-level assembly-line workers in a...

According to a labor union contract, the mean income for all senior-level assembly-line workers in a...

A production manager wants to assess the reactions of the blue-collar workers in his department (including...

QUESTION ONE A Consumer seeks to maximize a utility function Ux,y subject to his income constraint...

1)progressive income tax is one that A.taxes income at a constant rate, regardless of the level...

Suppose the goal of a union is to maximize the total income of all workers it...

Describe Modigliani’s life-cycle hypothesis. How do consumers maintain a constant level of consumption over time? How...

In details, discuss the inclusiveness of including all income on a tax return in the US....