question archive Currently you work for 40 hours per week at the wage rate of £20 an hour
Currently you work for 40 hours per week at the wage rate of £20 an hour
Subject:EconomicsPrice: Bought3
Currently you work for 40 hours per week at the wage rate of £20 an hour. Your free hours are defined as the number of hours not spent in work per week, which in this case is 24 hours × 7 days − 40 hours = 128 hours per week. Suppose now that your wage rate has decreased by 20%.
If you are happy to keep your total income for expenditure on consumption the same, then:
a) The opportunity cost of free hours has changed by :(20% or 25% or 0%).
b) There is a : (zero or positive or negative) income effect.
c) Your total number of working hours per week will rise by : (20%25%10%).
