Labor Supply. In the static (i.e., one-period) consumption-labor framework of Chapter 2, suppose that the utility function of any given consumer is u(c, n) =- 1-0 in which c denotes consumption and n denotes labor. The terms o (the Greek lowercase letter "sigma"), w (the Greek lowercase letter "psi"), and 0 (the Greek lowercase letter "theta") are all exogenous parameter values and thus are taken as given by the consumer. The range of numerical values of these three exogenous parameters are o > 0, w > 0, and 0> 0. In the following analysis, the parameters w and O are always held fixed at their (though unspecified) respective positive numerical values. There are two different types of consumers. All consumers have identical budget constraints c =won and identical Lagrange functions clo - 1 1+1 n 1-0 +a .[w.n-c]. 1+ - The only difference between the two categories of consumers is that the Type I consumer has a utility parameter o that is in the range 0 1.