C on a diagram identify the equilibria and label them

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c.On a diagram, identify the equilibria and label them as to theirstability. Explain why some of the equilibria are stable while others are not.
6.(25 marks) In the Krugman model of the “Big Push” with a traditional sectorand modern sector (their production functions are depicted in bold in thediagram below), explain why wage payment lines (W=wL) that fall betweenpoints A and B lead to two types of equilibria. What happens in each of thepossible equilibria and why? Explain what sort of “big push” would be necessaryto realize the better equilibrium.

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