Problem
Sasha has 60 hours a week she can work or have leisure. Wages are $8/hour.
a. Graph Sasha's budget constraint for income and leisure.
b. Suppose wages increase to $10/hour. Graph Sasha's new budget constraint.
c. When wages increase from $8/hour to $10/ hour, Sasha's leisure time decreases from 20 hours to 15 hours. Does her labor supply curve slope upward or downward over this wage increase?