Multiple Choice
If the MPS is 0.25 and the economy has a recessionary expenditure gap of $5 billion, then equilibrium GDP is
A) $5 billion below the full-employment GDP.
B) $5 billion above the full-employment GDP.
C) $20 billion below the full-employment GDP.
D) $20 billion above the full-employment GDP.
Correct Answer:
Verified
Correct Answer:
Verified
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