Calculate the market-clearing real wage

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Suppose we have an economy with only one aggregate production function, given by:

Y = A(K + N^ 2/3 )

where Y is output, A is TFP, K is capital and N is labour.

Let A = 9 and suppose the supply of labour, N^ S , is given by N^ S = 8w/3 . Calculate the market-clearing real wage, w, and how many workers, N, would be employed in the economy.

Reference no: EM13237499

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