Equilibrium and the equilibrium real gdp

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Suppose the economy is in equilibrium and the equilibrium real GDP is $800 billion.Suppose further that the MPC is 0.6. If the government decides to increase itsspending by $50 billion, what would be the ultimate effect of the change ingovernment spending on equilibrium real GDP? What is the new level of equilibriumreal GDP? Assume that the price level is fixed

Reference no: EM13881387

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