1118EconomicsMedium
The substitution effect of higher wages suggests that as the wage rate increases?
Aleisure becomes more expensive and households buy less of it
Bleisure becomes more expensive and households buy more of it
Cleisure becomes less expensive and households buy more of it
Dleisure becomes less expensive and households buy less of it.
Correct answer
A. leisure becomes more expensive and households buy less of it
Explanation
The correct answer is leisure becomes more expensive and households buy less of it.