Analyze how discovery would affect country economy

Reference no: EM133631285

Question

In the real business cycle model imagine a country suddenly discovers a large reserve of valuable natural resources, such as oil or rare minerals.

1. Economic Impact: Analyze how this discovery would affect the country's economy. Consider changes in output, investment, and employment.

2. Would this type of shock typically lead to business cycles consistent with the key business cycle facts? Explain using a table.

Reference no: EM133631285

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