(Solution Download) A worker views leisure and income as ?goods? and has an opportunity


A worker views leisure and income as ?goods? and has an opportunity to work at an hourly wage of $10 per hour.
a. Illustrate the worker?s opportunity set in a given 24-hour period.
b.

 

Suppose the worker is always willing to give up $12 dollars of income

 

for each hour of leisure. Do her preferences exhibit a diminishing

 

marginal rate of substitution? How many hours per day will she choose to

 

work?

 







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