Lower level of potential output

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"Techno-pessimists" like Bob Gordon believe that technology growth in the future will not be as fast as it has been in the past, resulting in a lower level of potential output. In our model, think of this as a lower z2. Use the I=S diagram to show the effect of a decline in future technology growth on savings, investment, and the interest rate. Justify your answers in words.

Reference no: EM131795245

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