The employer now offers him time-and-a-half wages 15w for


Suppose that Roy could choose how many hours to work at a wage of w and chose to work seven hours a day. The employer now offers him time-and-a-half wages (1.5w) for every hour he works beyond a minimum of eight hours per day. Show how his budget constraint changes. Will he choose to work more than seven hours a day?

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Econometrics: The employer now offers him time-and-a-half wages 15w for
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