Problem 1: Explain how each of the following will affect the consumption and saving schedules (as they relate to GDP) or the investment schedule, other things equal:
a. a large increase in the value of real estate, including private houses
b. a decline in the real interest rate
c. a sharp, sustained decline in stock prices
d. an increase in the rate of population growth.
e. the development of a cheaper method of manufacturing computer chips.
f. a sizable increase in the retirement age for collecting social security benefits.
Problem 2: Relate each of the following to the recent productivity acceleration:
a. information technology
b. increasing returns
c. network effects
d. global competition