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Y = AK[1-Q R W = (1 -Q) AKL- 1 R/P L = Ity N - 4 WP K Y = CSuppose that K doubles

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Y = AK[1-Q R W = (1 -Q) AKL- 1 R/P L = Ity N - 4 WP K Y = CSuppose that K doubles and A decreases by half. Construct a pair ofwelllabeled diagrams of equilibrium in the factor markets to show how the changes in A and E affect the supply of capital, the supply of labor, the real wage, and the real rental rate. Write down either in words or symbolically hora-lr the changes in I? and A would affect output Y and consumption 0

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