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As a result of the substitution effect, the worker would reduce his free time. The income effect means that the worker would increase his free
As a result of the substitution effect, the worker would reduce his free time.
The income effect means that the worker would increase his free time.
The worker may or may not reduce his free time as a result of the wage cut.
The income effect will always dominate the substitution effect of the wage cut.
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