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In the Short-Run Keynesian Model, to Close an Expansionary Gap

Question 49

Multiple Choice

In the short-run Keynesian model, to close an expansionary gap of $10 billion dollars government purchases must be:

A) increased by $10 billion.
B) decreased by $10 billion.
C) increased by more than $10 billion.
D) decreased by less than $10 billion.

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