24 Through the substitution effect a decrease in the wage ra

24. Through the substitution effect, a decrease in the wage rate will cause quantity of leisure desired (a) an increase (b) a decrease (c) no change (d) an ambiguous change in the 25. If Alice\'s wage increases from $6.00 per hour to $6.50 per hour, then: (a) she will want to work more hours than before her raise. (b) she will want to work fewer hours than before her raise. (c) she will want to work the same number of hours as before her raise. (d) she may want to work either more or fewer hours than before her raise. 26. If Gene receives a raise and then decides he would like to increase his hours of work, we know that: (a) his income effect is greater than his substitution effect. (b) his substitution effect is greater than his income effect. (c) his income and substitution effects are equal (d) his income and substitution effects reinforce each other.

Solution

24-the wage rate Will cause an increase in the quantity of leisure desired

25- option d is correct

26-his substitution effect is greater than his income effect