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7. Over the backward bending portion of the labour supply curve, a. The substitution effect of a wage change dominates the income effect. b. The wage elasticity of labour supply is positive. c. Leisure becomes an inferior good. d. The wage elasticity of labour supply is negative. 8. Identify the truthfulness of the following statements: 1. The substitution effect of a wage change is ambiguous in its direction. II. Direction of the income effect depends on whether the good is a normal or an inferior good. a. Both I and II are true. b. Both I and II are false. C. I is true, Il is false. d. I is false, Il is true. 9. Which of the following programs is an example of a demogrant? a. Old Age Security (OAS) b. Employment Insurance C. Canada Pension Plan (CPP) Benefits d. Canada Worker Benefits e. The Guaranteed Income Supplement
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