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Answer whether the following statements are true or false, explaining your answer in each case.
A. Given full and accurate measurement, and assuming there are no subsidies or taxes, we should get the same estimate of total economic activity whether we measure the value of production output, the level of factor incomes or spending on goods and services.
B. A closed economy is one with excessive levels of unemployment.
C. The calculation of value added is a way of measuring output without double counting.
D. Gross national product at current prices is a measure of real economic activity.
E. The Keynesian model suggests that output is mainly demand-determined.
F. Unplanned inventory changes are the signal to firms that there is disequilibrium.
G. The multiplier in our simple model tells us how much output changes when aggregate demand shifts.
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Comment on the effect of a recession on the investment curve (only) and on the level of savings, investment, and the equilibrium real interest rate in the financial crisis that hits United States first starting in fall 2007.
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