Suppose that Professor Jones receives a promotion and an increase in her annual salary.Her labor supply curve will be _____ if the substitution effect is _____ than the income effect.

A) upward sloping;greater
B) upward sloping;smaller
C) downward sloping;greater
D) vertical;greater

Labor Supply Curve

A graphical representation showing the relationship between the wage rate and the quantity of labor that workers are willing to supply.

Substitution Effect

The change in consumption patterns due to a change in relative prices, leading consumers to replace more expensive items with cheaper alternatives.

Income Effect

The change in an individual's or economy's income and how that change will affect the quantity demanded of a good or service.