Elucidate the likely effects on savings investment

Reference no: EM1336693

Decrease in Government Spending on Savings and Investment

Please explain the likely effects on Savings (Gross Private Domestic) Investment, Long Term Real Interest Rates, The Capital Stock, Natural RGDP and Natural Per Capita RGDP of a decrease in Government Investment Spending (with no change in tax rates). Please explain this in about two pages double spaced, and include information in terms of I = S prime + (T-G) + (IM-X)

Also show this shift on an equilibrium type graph where the R 0, R 1, and R 2 are on the Y axis and I0, I1,I2 and S0, S1, S2 are on X axis.

Reference no: EM1336693

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