Multiple Choice
In an economy, the government wants to decrease aggregate demand by $48 billion at each price level to decrease real GDP and control demand-pull inflation.If the MPS is 0.25, then it could
A) increase taxes by $16 billion.
B) increase taxes by $24 billion.
C) decrease government spending by $10 billion.
D) decrease government spending by $16 billion.
Correct Answer:
Verified
Correct Answer:
Verified
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