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In an Economy, the Government Wants to Increase Aggregate Demand

Question 168

Multiple Choice

In an economy, the government wants to increase aggregate demand by $50 billion at each price level to increase real GDP and reduce unemployment.If the MPS is .4, then it could increase government spending by:


A) $10 billion.
B) $20 billion.
C) $31.25 billion.
D) $40.50 billion.

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