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1.If saving dropped sharply in the economy, what would likely happen to investment? Why? 2. Suppose local governments throughout the United States increase their tax

1.If saving dropped sharply in the economy, what would likely happen to investment? Why?

2. Suppose local governments throughout the United States increase their tax on business inventories. What would you expect to happen to U.S. investment? Why?

3. Suppose the government announces it will pay for half of any new investment undertaken by firms. How will this affect the investment demand curve?

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