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3. [25 points] Consider the case of an underemployed worker who is constrained to 45 hours of work per week. The total endowment of
3. [25 points] Consider the case of an underemployed worker who is constrained to 45 hours of work per week. The total endowment of hours per week is 168 (= 24 hours x 7 days). a) [5 points] In a diagram, show the budget constraint and the optimal income- leisure combination for the underemployed worker. b) [10 points] Illustrate how this worker would respond to an offer to work as many more hours as the worker would like at the going wage. c) [10 points] Illustrate how this worker would respond to a payment of the moonlighting rate for hours of work beyond 45 hours.
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