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Assume the marginal propensity to consume = .8, and government purchases increase by $.2 Trillion.
1. Potentially, how much will real GDP increase in the short-run after the increase in government purchases?
2. Besides government purchases, what and how much did another spending category increased due to the multiplier described above? Explain?
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Last year, the nation of Tigerland imported goods totaling $500 million and exported products totaling $386 million. Tigerland experienced a(n).
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Suppose the banking system has reserve of $750000, demand deposits of $2500000 and a reserve requirement of 20%. a. if the fed now purchases $125,000 worth of govt bonds from the
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why lm curve upward sloping and is curve downward sloping?
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