Alice’s utility function is U ( C , L ) = C L She can work up to 80 hours each week and she has no non-labor income.

Alice’s utility function is U ( C , L ) = C · L

She can work up to 80 hours each week and she has no non-labor income.

If Alice’s non-labor income is zero, what will Alice’s reservation wage be?

If Alice’s non-labor income is $168 per week, what will Alice’s reservation wage be?

If Alice’s non-labor income is zero, how many hours will Alice work when wage is $20 per hour?

If Alice’s non-labor income is zero, how many more hours will Alice work when her wage increases from $20 per hour to $200 per hour?

 
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