4 Household Labor Supply A household of a wife and husband get utility from hours spent watching HBO (Z). To produce one unit of hours spent on watching HBO, this household need to subscribe to HBO...

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Extracted text: 4 Household Labor Supply A household of a wife and husband get utility from hours spent watching HBO (Z). To produce one unit of hours spent on watching HBO, this household need to subscribe to HBO that cost X, and spent time watching show together (t,, tw). The home production function is Z = X · t„th- Moreover, the utility function is linear (i.e. U(Z) =Z)). Assume that each member of the household either spent time watching HBO or out working in the labor market and get wage (wh, Ww). If you were a household planner, how do you think they should decide the optimal allocation of working hours? In a simple case, lets assume T = 1, and there is no out-out-labor market income (i.e. V = 0).