You are hired by the Council of Economic Advisors (CEA) as an economic consultant. The chairperson of the CEA tells you that she believes the current unemployment rate is too high. The unemployment rate can be reduced if aggregate output increases. She wants to know what policy to pursue to increase aggregate output by $400 billion. The best estimate she has for the MPC is 0.8. Which of the following policies should you recommend? Yanıtınız: reduce the budget deficit by $469 billion reduce taxes by $100 billion reduce taxes by $100 billion and increase government purchases increase government purchases by $100 billion $50 billion

You are hired by the Council of Economic Advisors (CEA) as an economic consultant. The chairperson of the CEA tells you that she believes the current unemployment rate is too high. The unemployment rate can be reduced if aggregate output increases. She wants to know what policy to pursue to increase aggregate output by $400 billion. The best estimate she has for the MPC is 0.8. Which of the following policies should you recommend? Yanıtınız: reduce the budget deficit by $469 billion reduce taxes by $100 billion reduce taxes by $100 billion and increase government purchases increase government purchases by $100 billion $50 billion

MACROECONOMICS FOR TODAY

10th Edition

ISBN:9781337613057

Author:Tucker

Publisher:Tucker

Chapter11: Fiscal Policy

Section: Chapter Questions

Problem 5SQP

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Simon was hired by the City Council of Economic Development (CCED) as an economic consultant. The chairperson of the CCED told Simon that she believed the current unemployment rate was too high. The unemployment rate can be reduced if the aggregate output increases. She wanted to know what policy to pursue to increase aggregate output by $400 billion. The best estimate she has for the MPC is 0.8. Which of the following policies should Simon recommend? O increase government purchases by $100 billion. O reduce the budget deficit by $400 billion. O reduce taxes by $100 billion. O reduce taxes by $100 billion and to increase government purchases by $50 billion.
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