Answered: 2) Current Real GDP = $21.5T Potential…

2) Current Real GDP = $21.5T Potential Real GDP = $20T MPS = .2 How much would be necessary to close the recessionary/ inflationary gap (circle one) using government spending?_ or taxes_ ?

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter18: Six Debates Over Macroeconomic Policy

Section: Chapter Questions

Problem 2QR

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Question

Graph the following situtaiton for the economy:

2) Current Real GDP = $21.5T
Potential Real GDP = $20T
MPS = .2
How much would be necessary to close the recessionary / inflationary gap (circle one)
using government spending?
or taxes_
?

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