ASAP PLEASE

Recall the Helsley and Strange(1990) model of labor matching discussed in class and the textbook. Draw the model for two different city types, one with 4 workers and 2 firms (SMALL CITY), and one with 8 workers and 4 firms (LARGE CITY) (Hint: see figure 3-4). Set the base wage rate to $10 and the base cost of training to $1 per 1/16 skill gap (Training cost in this model is the total size of the distance between worker and firm on the circle.) Suppose someone invents Google FaceMask, a product which is glued to workers faces and lets them interface with Google telepathically. This new increase in technology makes all work twice as valuable, but makes all training twice as costly since learning how to use FaceMask is difficult and the attachment process is traumatizing. Now the base wage is $20 but the training cost is $2 per 1/16 skill gap. Create two tables, one before and one after, calculating net wages for both cities. Does the gap in wages between the LARGE and SMALL city increase, decrease, or stay the same? What do you think this means for the prospect of smaller cities as technology becomes more and more vital to workers (while increasing training costs)?