How would each of the following affect Helena Hand basket supply of labor? a) Th

Question

How would each of the following affect Helena Hand basket supply of labor?

a) The value od Helena's home triples in an unexpectedly hot real estate market.

b) Originally an undskilled worker , Helena acquires skills thaat give her acces to a higher paying job. Assume that her preferences about leisure are not affected by the change in jobs.

c)A Temporay income tax surcharge raises the percentage of her income that she must pay in taxes for the current year only.(Taxes are proportinal to income in Hlena's counry.

Explanation / Answer

a) She would reduce supply of labour because she would be more wealthier and hence would afford more leisure.

b) She will increase her supply of labour.

c) she will reduce supply of labour as her income from working will be decreasing.

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