Suppose the government enacts a stimulus program composed of $400 billion of new government spending and $100 billion of tax cuts for an economy currently producing a GDP of $15,000 billion. If all of the new spending occurs in the current year and the government expenditure multiplier is 1.6, the expenditure portion of the stimulus package will addO percentage points of extra growth to the economy. (Round your response to two decimal places.) If the government taxation multiplier is 1.2, the tax cut portion of the stimulus package will add percentage points of extra growth to the economy. (Round your response to two decimal places.) As a result of the stimulus program, the economy's GDP was increased by percentage points over its value without the program. (Round your response to two decimal places.) If the economy's actual growth was - 5 percent, then without the stimulus package, growth would have been percentage points. (Round your response to two decimal places and use a minus sign if necessary.)

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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**Stimulus Program Analysis**

Suppose the government enacts a stimulus program composed of $400 billion of new government spending and $100 billion of tax cuts for an economy currently producing a GDP of $15,000 billion.

1. **Government Expenditure Multiplier Impact:**  
   - If all of the new spending occurs in the current year and the government expenditure multiplier is 1.6, the expenditure portion of the stimulus package will add [ ] percentage points of extra growth to the economy.  
   *(Round your response to two decimal places.)*

2. **Government Taxation Multiplier Impact:**  
   - If the government taxation multiplier is 1.2, the tax cut portion of the stimulus package will add [ ] percentage points of extra growth to the economy.  
   *(Round your response to two decimal places.)*

3. **Total GDP Increase Due to Stimulus Program:**  
   - As a result of the stimulus program, the economy's GDP was increased by [ ] percentage points over its value without the program.  
   *(Round your response to two decimal places.)*

4. **Economy’s Actual Growth Without Stimulus Package:**  
   - If the economy's actual growth was −5 percent, then without the stimulus package, growth would have been [ ] percentage points.  
   *(Round your response to two decimal places and use a minus sign if necessary.)*
Transcribed Image Text:**Stimulus Program Analysis** Suppose the government enacts a stimulus program composed of $400 billion of new government spending and $100 billion of tax cuts for an economy currently producing a GDP of $15,000 billion. 1. **Government Expenditure Multiplier Impact:** - If all of the new spending occurs in the current year and the government expenditure multiplier is 1.6, the expenditure portion of the stimulus package will add [ ] percentage points of extra growth to the economy. *(Round your response to two decimal places.)* 2. **Government Taxation Multiplier Impact:** - If the government taxation multiplier is 1.2, the tax cut portion of the stimulus package will add [ ] percentage points of extra growth to the economy. *(Round your response to two decimal places.)* 3. **Total GDP Increase Due to Stimulus Program:** - As a result of the stimulus program, the economy's GDP was increased by [ ] percentage points over its value without the program. *(Round your response to two decimal places.)* 4. **Economy’s Actual Growth Without Stimulus Package:** - If the economy's actual growth was −5 percent, then without the stimulus package, growth would have been [ ] percentage points. *(Round your response to two decimal places and use a minus sign if necessary.)*
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