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the slopes of the price lines tell you do 8. Suppose that computers use 4 units of capital for each worker, so that KC 4.

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the slopes of the price lines tell you do 8. Suppose that computers use 4 units of capital for each worker, so that KC 4. C. whereas shoes use 0.2 units of capital for each worker, so that KS : 0.2LS. There are 200 workers and 200 units of capital in the economy. (5 points each) a. Solve for the amount of labor and capital used in each industry. Hint: The box diagram shown in Figure 5-6 means that the amount of labor and capital used in each industry must add up to the total for the economy, so that KC + KS = 200 and LC + LS = 200 Use the facts that KC 4. LC and KS : 0.2 LS to rewrite these equations as 4. LC +0.2 L5 = 100 and LC + LS = 200 Use these two equations to solve for LC and LS, and then calculate the amount of capital used in each industry using KC : 4. LC and KS = 0.2LS. b. Suppose that the number of workers increases to 250 because of immigration, keeping total capital fixed at 200. Again, solve for the amount of labor and capital used in each industry. Hint: Redo the calculations from part (a), but using LC + LS : 250. Short Answer 9. According to part A of Table 51 on page 147, what education level loses most i.e., has the greatest decrease in wage) from immigration to the United States? Does this result depend on keeping the rental on capital constant? Explain why or why not. (10 Points)

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