If the income effect of a wage change outweighs the substitution effect of a wage change, the labor-supply curve is

A) upward sloping.
B) horizontal.
C) vertical.
D) backward bending.

Income Effect

The adjustment in income of an individual or an economic system, and its effect on how much of a good or service is demanded.

Substitution Effect

The change in consumption resulting from a change in the price of a good, causing consumers to replace more expensive items with less expensive ones.

Labor-Supply Curve

A graphical representation that shows the relationship between the wage rate and the quantity of labor workers are willing to supply.