(e) Now suppose that the system is initially in a steady state corresponding the pro- ductivity level...

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(e) Now suppose that the system is initially in a steady state corresponding the pro- ductivity level A, but the firm learns (by surprise) on date that A will rise perma- nently to A' at some future date T. (Perhaps the firm learns that it will be able to use a new invention that aids productivity but not until the patent expires at time T.) Show, using your K. q graph, what happens at time t and thereafter.

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