26 How do investment in technology and investment in capital differ? They have d

26 They have different effects on output because of the positive externalities associated with investments in technology 27. will become smaller

ID: 1193226 • Letter: 2

Question

How do investment in technology and investment in capital differ?

They have different effects on output because of the positive externalities associated with investments in capital.

They have different effects on output because of the positive externalities associate with investments in technology.

They have the same effects on output but investments in technology are much more closely tied to the level of saving than investments in capital.

They have similar effects on output so they have no important differences from an economic point of view.

If banks hold excess reserves whereas before they did not, the money multiplier:

Will be unaffected

Will become smaller

Will become larger

Might increase or might decrease

They have different effects on output because of the positive externalities associated with investments in technology

27.

will become smaller

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