1 This question can be answered qualitatively keeping in mind what we learned in GDP growth accounting (assuming an aggregate Cobb-Douglas production function). The Inflation Reduction Act (IRA) is a legislation enacted in August 2022 by the U.S. Congress. One of the goals of IRA was to use government subsidies to stimulate private investment in clean energy and consequently increase future national productive capacity. a) Suppose that IRA succeeds. Then, holding employment and total factor productivity constant, explain how an increase in gross private investment in the present (in period t) affects i. the capital stock in the future (at the beginning of period t+1), ii. the growth rate in capital (between t and t + 1), iii. real GDP in the future (over t+1), and iv. the growth rate in real GDP (between t and t+1). b) How will the same increase in private investment in the present affect iii. future real GDP and iv. the growth rate in real GDP if the future labor supply is an increasing function of the real wage (holding total factor productivity constant)? Under these circumstances, will the future real wage increase more or less than what would have happened under the