Country experiences a recessionary gap mps

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According to the Keynesian model, if a country experiences a recessionary gap MPS is 0.2Group of answer choices of $100 billion and the , which of the following do we need to get back to full employment? {Hint: we need to increase equilibrium GDP by $100 billion, Mk = 1/(0.2), and Mt = - (Mk -1).}

a A decrease in taxes of $100 billion.

b All of the listed options are incorrect.

c An increase in government spending of $100 billion.

d An increase in government spending of $25 billion.

e A decrease in taxes of $25 billion.

Reference no: EM132600959

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