An economy consists of two regions, the North and the South. The short-run elasticity of labor demand in each region is 0.5 (such that for every 1% increase in the wage, employment drops by 0.5%, or vice versa: for every 1% increase in employment, the wage decreases by 2%). Labor supply is perfectly inelastic within both regions. The labor market is initially in an economywide equilibrium, with 600,000 people employed in the North and 400,000 in the South at a wage of $15 per hour. Suddenly, 20,000 people immigrate from abroad and initially settle in the South. They possess the same skills as the native residents and also supply their labor inelastically. A) What will be the effect of this immigration on wages and employment in each of the regions in the short run (i.e. before any migration between the North and the South occurs)? (You should nd exact answers, not just say whether wages or employment will \"increase\" or \"decrease\"). B) Suppose that for every dollar difference in the hourly wage between the two regions, 1,000 people per year migrate from the South to the North (e.g. if the wage gap (111mm wswth) would be 1 dollar, 1000 people would migrate North each year, but if the wage gap is only 0.5 dollars, then only 500 would migrate North per year). What will be the new equilibrium wage rates and employment levels in each of the two regions after one year? (Again, give exact answers.)