Don't answer by pen paper and don't use chatgpt otherwise we will give dounvote Suppose that real GDP is currently $13.5 trillion and potential real GDP is $14.0 trillion, or a gap of $500 billion. Thegovernment purchases multiplier is 3.3, and the tax multiplier is 2.3.Holding other factors constant, by how much will government purchases need to be increased to bring the economyto equilibrium at potential GDP?Government spending will need to be increased by $whole number.)billion. (Enter your response rounded to the nearestHolding other factors constant, by how much will taxes have to be cut to bring the economy to equilibrium atpotential GDP?Taxes will need to be cut by $ billion. (Enter your response rounded to the nearest whole number.)

The real GDP is $13.5 trillion. Potential real GDP is $14 trillion Since real GDP is smaller than…

Answered: Suppose that real GDP is currently…

Suppose that real GDP is currently $13.5 trillion and potential real GDP is $14.0 trillion, or a gap of $500 billion. The government purchases multiplier is 3.3, and the tax multiplier is 2.3.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Don't answer by pen paper and don't use chatgpt otherwise we will give dounvote

Suppose that real GDP is currently $13.5 trillion and potential real GDP is $14.0 trillion, or a gap of $500 billion. The
government purchases multiplier is 3.3, and the tax multiplier is 2.3.
Holding other factors constant, by how much will government purchases need to be increased to bring the economy
to equilibrium at potential GDP?
Government spending will need to be increased by $
whole number.)
billion. (Enter your response rounded to the nearest
Holding other factors constant, by how much will taxes have to be cut to bring the economy to equilibrium at
potential GDP?
Taxes will need to be cut by $ billion. (Enter your response rounded to the nearest whole number.)

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