Consider the change in parts c and f in question before. Separately explain, using graphs, individuals' labor supply responses to these changes.

(Before question)

Consider the labor supply model we studied in chapter 6. An individual has 16 hours per day available. His non-labor income = 0. He can work for $5 per hour. Draw the budget line in the following scenarios. Use the numbers in the main part of the question, and apply the changes in each part separately. That is, the changes in part b do not apply to part c, and the changes in part c do not apply to part d, and so on.

(part C)

Individual gets a 50% increase in wage for hours worked beyond 8.

(part F)

Government guarantees that everyone has $40 per day. For example, the government pays a subsidy to individuals such that their income is $40 if their earnings are less than $40. For those who earn $40 or more, the subsidy is zero.