Problem
I. As discussed in the lecture, working hours have been declining overtime, together with rising income per capita. In the last few years, there have been talk and movement to shorten working hours per week, more specifically, a model of a four-day work week has emerged. This model allows employees to work less hours but maintain the same amount of work done as if they work for five days, and thus they receive the same pay. In other words, compared to the five-day work week model, the four-day one offers 80% worked hours, 100% workload, and 100% pay. In what ways can this model be good for an economy? (Hint: think about the benefits for employees, employers, and society in general)
II. Draw a diagram illustrating the increased utility/satisfaction for consumers as a result of a shorter working week. (Hint: although total monthly salary stays the same, shorter working hours per week implies an increase in the wage rate per hour.) Make sure you explain your diagram too.