1. Laszlo's labor supply. Laszlo's preferences over consumption and leisure are represented by the utility function 1.103,!) : %In(c) + %ln(1 I), where c is units of consumption good, 1 is the total (normalized) non-sleeping time and I is the fraction of time spent working. Let p : 1 denote the price of the consumption good, in the wage rate, and I Laszlo's non-labor income. (3.) Compute Laszlo's labor supply for a! = 3 and I = 3. (20 points) (1)) How does Lasslo's labor supply changes if in = 1 and his income rises to I = 4'? (10 points) (c) How does Laszlo's labor supply changes if I : 3 and his wage rises to is : 4'? Decompose the total effect into income and substitution effects. (10 points) (d) Compute Laszlo's individual labor supply function and his reservation wage. (20 points) (e) Now assume that all 5,000 inhabitants of Laszlo hometown share his prefer- ences. Half of them also have the same non-labor income I : 3. However, the other half has I : 4. Compute the town's aggregate labor supply func- tion. (10 points)