Priya desires to maximize utility, U, which is a function of her consumption of consumer goods C and leisure time L, subject to the budget constraint that she must live within her income. She receives V dollars per period in non-work income, works H hours per period, enjoys L hours of leisure time, and is paid a wage of W for each hour of work. The price of consumption is P dollars per unit. P and V remain unchanged, but W increases. We find that Priya's hours of work increase. 

A. Given this information, can we be sure that leisure, L, is a normal good? Why, or why not? Explain your answer. 

B. Given this information, can we be sure that leisure, L, is an inferior good? Why, or why not? Explain your answer.

Answer rating: 100% (QA)

A Given the information above L cannot be a normal good because normal goods a... View the full answer