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Sagot :
Answer: decline; return to the steady state level
Explanation:
Physical capital can help in the production of goods and services. If a significant amount was to be destroyed, this would mean less production of goods. This will therefore lead to a decline in the GDP in the Short run.
In the long run however, the real GDP will return to a steady state where the GDP will become the potential GDP as a result of the physical capital has either been replaced or rebuilt in the future thereby leading to the production level which will increase.
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