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Consider Fred's investment in units of health capital with the following function: I = 500 - 1000 (Cost of Capital) a. If the cost of
Consider Fred's investment in units of health capital with the following function: I = 500 - 1000 (Cost of Capital)
a. If the cost of capital is 10 percent each year, what is the equilibrium health investment in terms of units of capital?
b. If the cost per unit of health capital doubles to 20 percent, what will happen to the equilibrium level of health investment?
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