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The Investment Schedule Is Downward Sloping and the Saving Schedule

Question 334

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The investment schedule is downward sloping and the saving schedule is upward sloping with respect to the interest rate. Suppose the equilibrium real investment per year at the market rate of interest is $1 trillion. How is this represented when real national income per year is on the horizontal axis? How is this incorporated into the consumption-function graph?

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Investment spending is a function of the...

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