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Suppose There Has Been an Increase in Government Spending

Question 146

Multiple Choice

Suppose there has been an increase in government spending.As a result, real GDP will ________ in the short run, and ________ in the long run.


A) increase; increase further
B) increase; decrease to its initial value
C) decrease; decrease further
D) decrease; increase to its initial level
E) decrease; remain at this lower level

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