Determine effects of this on paths of aggregate consumption

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Suppose that the government makes a one-time investment in new public school buildings, which results in a one-time reduction in consumption. The new public school buildings increase the e?ciency with which human capital is accumulated. Use the endogenous growth model to determine the e?ects of this on the paths of aggregate consumption and aggregate output overtime. Is it clear that this investment in the new schools a good idea? Explain.

Reference no: EM1349836

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