Multiple Choice
Assume the multiplier is 5 and that the crowding-out effect is $20 billion. An increase in government purchases of $10 billion will shift the aggregate-demand curve to the
A) right by $150 billion.
B) right by $70 billion.
C) right by $30 billion.
D) None of the above is correct.
Correct Answer:
Verified
Correct Answer:
Verified
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