Suppose the government decides to decrease the amount of investment spending that firms are allowed to depreciate for tax purposes from 50% to 25%,effective next year.What effect should this change have on the desired capital stock and the level of investment spending next year? Use a graph to explain your answer.

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The Answer of Suppose the government decides to decrease the amount of investment spending that firms are allowed to depreciate for tax purposes from 50% to 25%,effective next year.What effect should this change have on the desired capital stock and the level of investment spending next year? Use a graph to explain your answer.

Suppose the Government Decides to Decrease the Amount of Investment