Consider an economy where the dominant industry is automobile production for both domestic consumption as well as

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Consider an economy where the dominant industry is automobile production for both domestic consumption as well as export. Now suppose auto sales fall in response to an increase in the length of time people use their cars before replacing them. Describe the probable effects of this change on

(a) GDP,

(b) unemployment,

(c) the government budget deficit, and

(d) interest rates. P-968

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ISE Investments

ISBN: 9781266085963

13th International Edition

Authors: Zvi Bodie, Alex Kane, Alan Marcus

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