Question: Consider an economy where the aggregate production function is characterized by the following equation: Y=2N^1/2. The labor supply curve is given by the following equation:

Consider an economy where the aggregate production function is characterized by the following equation: Y=2N^1/2. The labor supply curve is given by the following equation: Ns=8(W/P). Derive the labor demand curve and calculate the equilibrium real wage and the equilibrium level of labor.

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