Economics (MindTap Course List)
Solutions
Economics (MindTap Course List)
In the standard textbook Keynesian analysis, there is reason to believe that the government spending multiplier is larger than the tax multiplier. Why?
Reason for economist who believes that the government spending multiplier is larger than the tax multiplier
The multiplier indicates the number of time income increases by increasing the government spending. As per standard Keynesian analysis, economist believes that spending the multiplier is greater than the tax multiplier. If the government spends $1, then $1 fully comes to the spending stream...
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