Multiple Choice
Given full-employment output = $2,800, equilibrium real GDP = $2,500, and MPS = 0.25, which of the following changes would most likely bring the economy to a full-employment level of real GDP?
A) $300 decrease in taxes.
B) $75 increase in government spending.
C) $75 decrease in taxes.
D) $300 increase in government spending.
E) $75 decrease in government spending.
Correct Answer:
Verified
Correct Answer:
Verified
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