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All of them 2. (30 points) Suppose that households' future income substantially increases. a. Show on a graph (with axes labor NV and real wage

All of them

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2. (30 points) Suppose that households' future income substantially increases. a. Show on a graph (with axes labor NV and real wage rate w) the effects on the labor market. b. Explain intuitively what happens to the equilibrium employment and real wage rate. c. After the labor market moves to the new equilibrium, show on a graph (with axes capital K and user cost uc) what happens in the capital market. d. Explain intuitively what happens to the equilibrium desired capital and user cost

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