Place the following events in the proper sequence according to the new growth theory. i) labor demand increases
Ii) employment increases
Iii) an increase in labor productivity shifts the production function upward
Iv) the real wage increases

Question

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According to the new growth theory, an increase in labor productivity shifts the production function upward (iii), leading to an increase in labor demand (i). This increase in demand causes the real wage to increase (iv), and subsequently, employment increases (ii).

Place the Following Events in the Proper Sequence According to the New