Calculate the change in the level of real gdp demanded

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Reference no: EM13832851

(Changes in Government Purchases) Assume that government purchases decrease by $ 10 billion, with other factors held constant, including the price level. Calculate the change in the level of real GDP demanded for each of the following values of the MPC. Then, calculate the change if the government, instead of reducng its purchases, increased autonomous net taxes by $ 10 billion:

a. 0.8

b. 0.75

c. 0.6

Reference no: EM13832851

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