The income effect in the work-leisure model induces a person to work less in response to higher wages, which tends to make the labor-supply curve slope backward.

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Michelle Rivera · Accepted Answer

Final Answer : True, Explanation :  The income effect describes how higher wages increase a person's overall income, potentially leading them to value leisure time more and choose to work fewer hours, which can result in a backward-sloping labor supply curve at higher wage rates.

The income effect in the work-leisure model induces a person to work less in response to higher wages, which tends to make the labor-supply curve slope backward.

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