Eco_1_problem_set_11

Eco_1_problem_set_11 - growth in the United States: a)...

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Eco 1 Spring 2007 Problem Set 12 1) Use the points on the diagram below. a) Identify which combinations of these points illustrate diminishing returns to capital. Give a brief explanation to support your answer. b) Identify which combinations of these points illustrate technological change (without capital expansion). c) Identify one combination of these points which illustrates technological change with capital expansion. 2) Briefly explain which of the following policies are likely to increase the rate of economic
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Unformatted text preview: growth in the United States: a) Congress passes an investment tax credit, which reduces a firms taxes if it installs new machinery and equipment. b) Congress passes a law that allows taxpayers to reduce their income taxes by the amount of state sales taxes that they pay. c) Congress provides more funds for low-interest loans to college students. Eco 1 Spring 2007 Problem Set 12 3) 4) 5) Eco 1 Spring 2007 Problem Set 12 6) 7) 8) Eco 1 Spring 2007 Problem Set 12 9) 10)...
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Eco_1_problem_set_11 - growth in the United States: a)...

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