Assuming leisure is a normal good, if the income effect is greater than the substitution effect a wage increase ?

could cause either an increases or a decrease in labour supply

will have no effect on labour supply

Assuming leisure is a normal good, if the income effect is greater th

1.	Assuming leisure is a normal good, if the income effect is greater than the substitution effect a wage increase ?
A.	will have no effect on labour supply
B.	will decreases labour supply
C.	could cause either an increases or a decrease in labour supply
D.	will increase labour supply.
Answer» C. could cause either an increases or a decrease in labour supply

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Assuming leisure is a normal good, if the income effect is greater than the substitution effect a wage increase ?

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