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Business, 08.11.2019 05:31 gjfhjgg2848

Suppose that there is a natural disaster that destroys part of the nation’s capital stock. (a) determine the effects on aggregate output, consumption, employment, and the real wage, with reference to income and substitu- tion effects, and explain your results. (b) do you think that changes in the capital stock are a likely cause of business cycles? explain with reference to your answer to part (a) and the key business cycle facts described in chapter 3.

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Suppose that there is a natural disaster that destroys part of the nation’s capital stock. (a) deter...
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