Slow-growth recovery due to a decline in investment

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The U.S. economy fell into a recession in 2001 and then proceeded into a slow-growth recovery due to a decline in investment. A. Explain how a change in investment can have a big impact on GDP causing a national recession. B. Illustrate by showing what it looks like using the AD-AS model. C. How did low interest rates combined with increased government spending on defense and national security alter the U.S. economic outlook? Explain using the AD-AS model (explanation and illustration).

Reference no: EM13739500

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