Suppose a worker is offered a wage of $8 per hour,plus a fixed payment of $100 per day,and he can use 24 hours per day.What is the market rate of substitution between leisure and income?
A) $5
B) $8
C) $10
D) None of the preceding statements is correct.

Question

Quizplus · Accepted Answer

The market rate of substitution between leisure and income is the wage rate, which is $8 per hour in this case.

Suppose a Worker Is Offered a Wage of $8 Per