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QUESTION
If the desired capital stock is $20,000, the current level of the capital stock is $12,000, and a firm wishes to close half of the gap between them
If the desired capital stock is $20,000, the current level of the capital stock is $12,000, and a firm wishes to close half of the gap between them each period, what does the flexible accelerator model suggest will be next period's level of investment? What will be the level of investment the year after that?
