Question

What is one explanation for why this labor supply curve is upward sloping? the opportunity cost of leisure decreases as wages decrease. people prefer to spend time doing leisure activities rather than working. labor production functions exhibit diminishing marginal returns. unemployment benefits are steadily declining?

Answer 1

I believe the correct answer is the first option. The labor supply curve is upward sloping because the opportunity cost of leisure decreases as wages decrease and the opposite of such is true as well. As one work one hour more, one will have less time for other activities. As the work rate increases in value, then the opportunity cost increases as well.

Answer 2

You correct answer is the fist one the labor supply curve is sloping upwards because the opportunity cost of leisure decreases as wages decline and the opposite is true as well. As you work one more hour, you will have less time for other activities.