An increase in the wage from $6 per hour to $6.50 per hour causes a worker to increase her hours worked from 40 to 45 hours per week. For this worker, which effect dominates?
Working hours relate to the amount of time that an employee spends when carrying out his or her work duties. In the U.S, the working hours normally affect the amount of money an employee earns since wage pay is mainly based on the working hours. Thus, employees who work for a long duration earn more than employees who work in the same job but for a shorter duration.
Answer and Explanation: 1
An increase in the wage from $6 per hour to $6.50 per hour causes a worker to increase her hours worked from 40 to 45 hours per week. For this worker,...
See full answer below.
Become a member and unlock all Study Answers
Start today. Try it nowCreate an account
Ask a question
Our experts can answer your tough homework and study questions.Ask a question Ask a question
Learn more about this topic:
fromChapter 3 / Lesson 17
Explore the substitution effect. Learn the definition of the substitution effect and how it differs from the income effect. See examples of the substitution effect.