Macroeconomics 20th Edition by Campbell McConnell ,Stanley Brue ,Sean Flynn

Exercise 16

The economy's current level of equilibrium GDP is $780 billion. The full employment level of GDP is $800 billion. The multiplier is 4. Given those facts, we know that the economy faces _______ expenditure gap of _______.
A) An inflationary; $5 billion.
B) An inflationary; $10 billion.
C) An inflationary; $20 billion.
D) A recessionary; $5 billion.
E) A recessionary; $10 billion.
F) A recessionary; $20 billion.