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Suppose that the social assistant benefit that worker receives is reduced, as and such he can no longer pay his rent. He therefore decides that
Suppose that the social assistant benefit that worker receives is reduced, as and such he can no longer pay his rent. He therefore decides that he must work longer hours. What type of effect is involved?
a. Only a substitution effect
b. Only an income effect
c. Both a substitution and an income effect
d. A reservation wage effect
e. No impact on incentives at all
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