A country produces good X using labor (L) and capital (K), and good Y using L and

Fantastic news! We've Found the answer you've been seeking!

Question:

A country produces good X using labor (L) and capital (K), and good Y using L and land (T). Unfortunately they suffer an earthquake in a major city and some of their capital stock is destroyed. a) What happens to MP L in X sector? b) What does this mean for labor demand for producing good X? c) What will happen to the allocation of labor? d) What will happen to nominal wages? (w) e) How does output of X and Y change? f) What happens to i) The real wage of workers ii) The real return to landowners