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3.125 points Seve An Suppose you are told that economists estimate, after the effects of all the COVID relief packages have worked their way through the economy, that equilibrium output will still fall $800 billion short of full-employment output. You are also told that the estimate of the U.S. mps is 0.2. Assuming there is zero threat of inflation (ie. that prices will remain constant as AD increases), to close this gap how large would you recommend the NEXT COVID relief package be? $200 billion A. $200 billion oc $400 billion $800 billion D.

3.125 points Seve An Suppose you are told that economists estimate, after the effects of all the COVID relief packages have worked their way through the economy, that equilibrium output will still fall $800 billion short of full-employment output. You are also told that the estimate of the U.S. mps is 0.2. Assuming there is zero threat of inflation (ie. that prices will remain constant as AD increases), to close this gap how large would you recommend the NEXT COVID relief package be? $200 billion A. $200 billion oc $400 billion $800 billion D.

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Economics Question 3 of 32 Question 3 3.125 points Save Anower Suppose you are told that economists estimate, after the effects of all the COVID relief packages have worked their way through the economy, that equilibrium output will still fall $800 billion short of full-employment output. You are also told that the estimate of the U.S. mps is 0.2. Assuming there is zero threat of inflation (i.e. that prices will remain constant as AD increases), to close this gap how large would you recommend the NEXT COVID relief package be? OA $200 billion O B. $200 billion Oc $400 billion OR $800 billion
Transcribed Image Text:Economics Question 3 of 32 Question 3 3.125 points Save Anower Suppose you are told that economists estimate, after the effects of all the COVID relief packages have worked their way through the economy, that equilibrium output will still fall $800 billion short of full-employment output. You are also told that the estimate of the U.S. mps is 0.2. Assuming there is zero threat of inflation (i.e. that prices will remain constant as AD increases), to close this gap how large would you recommend the NEXT COVID relief package be? OA $200 billion O B. $200 billion Oc $400 billion OR $800 billion
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