Assume potential GDP is 3,500 and actual GDP is 3,000. If the consumption function is C=250+0.75Yd, how much does government expenditure need to rise by to close the output gap? (Please input the round number without any Euro symbol)
Assume potential GDP is 3,500 and actual GDP is 3,000. If the consumption function is C=250+0.75Yd, how much does government expenditure need to rise by to close the output gap? (Please input the round number without any Euro symbol)
Chapter9: The Keynesian Model In Action
Section: Chapter Questions
Problem 3SQ
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![Assume potential GDP is 3,500 and actual
GDP is 3,000. If the consumption function is
C=250+0.75Yd, how much does
government expenditure need to rise by to
close the output gap? (Please input the
round number without any Euro symbol)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7ccddde9-6293-4ca9-add0-e7ef689c83f0%2F268baafe-a680-4346-a82b-5ec3346dd587%2Fv7xuueb_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Assume potential GDP is 3,500 and actual
GDP is 3,000. If the consumption function is
C=250+0.75Yd, how much does
government expenditure need to rise by to
close the output gap? (Please input the
round number without any Euro symbol)
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