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Adeveloping country has determined that each additional $1 billion of investment in capital goods adds 0.3 percentage point to its longwrun average annual rate of
Adeveloping country has determined that each additional $1 billion of investment in capital goods adds 0.3 percentage point to its longwrun average annual rate of growth of per capita real GDP. Domestic entrepreneurs recently began to seek official approval to open a range of businesses employing capital resources valued at $30 billion. It the entrepreneurs undertake these investments. and assuming that other things are equal. calculate the nation's long-run average annual rate of growth of per capita real GDP up to a fraction of a percentage point. a percent. (Round your answer to one decimai place.) After weeks of effort trying to complete the first of 15 stages of bureaucratic red tape necessary to obtain authorization to start their businesses. a number of entrepreneurs decide to drop their investment plans completely. and the amount of official investment that actually takes place turns out to be $5 billion. Dther things being equal, by what fraction ofa percentage point will this decision reduce the nation's long-run average annual rate of growth of per capita real GDP from what it would have been if investment had been $30 billion? D percent. (Round your answer to one decimai piece}I
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