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(b) (3 points) Recall that leisure time in our model is intended to capture any time not spent on the labor market, which includes work
(b) (3 points) Recall that leisure time in our model is intended to capture any time not spent on the labor market, which includes work at home such as housework and caring for children. Subsidized day care, washing machine, and healthy tasty TV dinners all reduced the demand for Rose's time in home production. As a result Rose's preference becomes u(c,l) = \\/E + 4%. At the meantime, equal pay movement raises Rose's wage to 15. But her nonwage income falls to 2 due to her recent divorce. How does Rose allocate her time now? How much is her consumption
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