Q
The substitution effect of higher wages suggests that as the wage rate increases ?
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A
A. Leisure becomes less expensive and households buy more of it
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B
B. Leisure becomes more expensive and households buy more of it
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C
C. Leisure becomes more expensive and households buy less of it
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D
D. Leisure becomes less expensive and households buy less of it.
Correct Answer:
C. C. Leisure becomes more expensive and households buy less of it
