Figure 7: The Evolution of Output, Potential Output, and Output with Capital
Stock Held Fixed in Time.
0.56
0.55
0.54
----- Output
• ∙ ∙ ∙ Output under Perfect Foresight with Time Varying Capital Stock_
0.53
0
5
10
20
25
30
15
Time
Figure 8: The Evolution of Output, Output under Perfect Foresight with Time
Varying Capital Stock, and the Average Level of Output.
30
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