2. Production function: Y=8(K^.33)(L^.66) What if there is skill biased technological change that makes capital more productive relative to labor such that alpha or the exponent on K rises to .5 and the exponent on L falls to .5 a) What is the new equilibrium real wage (assume no change in the labor supply equation & K = 1)? Labor Supply= (w/p)^2 b) What is the new equilibrium R/P (assume no change in the capital supply equation & L = 4)? Capital Supply= 1000(R/P)

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