Assume MPS-.3, Actual Real GDP-$560 and Potential Output $300. Answer the following questions: A. By how much would the government increase or decrease government spending to close this gap? B. By how much would the government increase or decrease taxes to close the Gap? $78.1 decrease: $111.59 increase $300 decrease: $260 decrease m $111.59 decrease; $78.1 decrease Not enough information provided
Assume MPS-.3, Actual Real GDP-$560 and Potential Output $300. Answer the following questions: A. By how much would the government increase or decrease government spending to close this gap? B. By how much would the government increase or decrease taxes to close the Gap? $78.1 decrease: $111.59 increase $300 decrease: $260 decrease m $111.59 decrease; $78.1 decrease Not enough information provided
Chapter9: Demand-side Equilibrium: Unemployment Or Inflation?
Section9.A: The Simple Algebra Of Income Determination And The Multiplier
Problem 4TY
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![Assume MPS=.3, Actual Real GDP=$560 and Potential Output = $300. Answer the following questions:
A. By how much would the government increase or decrease government spending to close this gap?
B. By how much would the government increase or decrease taxes to close the Gap?
$78.1 decrease; $111.59 increase
$300 decrease: $260 decrease
$111.59 decrease; $78.1 decrease
Not enough information provided](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe103e755-30e1-46df-9fb6-88e22ca74a1c%2Ffd77f1c4-ea88-4baf-a86f-a5ebc3a92a77%2F912rzue_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Assume MPS=.3, Actual Real GDP=$560 and Potential Output = $300. Answer the following questions:
A. By how much would the government increase or decrease government spending to close this gap?
B. By how much would the government increase or decrease taxes to close the Gap?
$78.1 decrease; $111.59 increase
$300 decrease: $260 decrease
$111.59 decrease; $78.1 decrease
Not enough information provided
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