Question
2. The economy is experiencing a contraction (recessionary gap) of $400 billion. What government spending stimulus would you recommend to move the economy back to
2. The economy is experiencing a contraction (recessionary gap) of $400 billion. What government spending stimulus would you recommend to move the economy back to full employment if the MPC is 0.75? Would your policy be any different if the MPC were 0.66?
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Macroeconomics
Authors: Glenn Hubbard, Anthony Patrick O'Brien, Matthew P Rafferty
1st Edition
978-0132109994, 0132109999
