Explain why in product markets the substitution and income effects work in the same direction for normal

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Explain why in product markets the substitution and income effects work in the same direction for normal goods, but in the labour market, the income and substitution effects work in opposite directions when leisure is considered a normal good.

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Economics

ISBN: 978-1133561675

11th edition

Authors: Roger A. Arnold

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Posted Date: Sep 01, 2020 02:00 AM

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Explain why in product markets the substitution and income effects work in the same direction for normal

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The income effect and substitution effect are related economic concepts in consumer choice theory The income effect expresses the impact of changes in ... View the full answer

Economics

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