Problem
Suppose the introduction of a new technology for production causes an increase in investment at each real interest rate. What will be the impact of this change on the equilibrium real rate of interest and the level of saving and investment if the interest rate elasticity of household saving is zero? How do your answers change if the interest rate elasticity of household saving is positive?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.