0p LD - L +Le 0{_' Labor in Desk industry Labor in Corn Industry Show how the increase in the price of corn P affects the equilibrium wage. . (5 points) Will trade increase the real wage in terms of desks? Why or why not? Would a worker who doesn't consume any corn be better or worse off from trade? . (5 points) As in class, assume that the marginal product of capital and the marginal product of land are increasing in the amount of labor used in their respective industry. Based on your results in question (3), how do they change with trade? (4 points) The rental on land and the rental on capital must be equal to: Rx = MPKp - Pp Rr = MPT;- P How do the real rentals in terms of desks, Ry /Pp and Ry /Pp, change with trade. Will capital and land owners both be better off from trade if their consumption is mostly in desks