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Congress decides to enact expansionary fiscal policy and increase government spending by $35 billion. Suppose the marginal propensity to consume is 0.6. Assuming no crowding
Congress decides to enact expansionary fiscal policy and increase government spending by $35 billion. Suppose the marginal propensity to consume is 0.6. Assuming no crowding out effect, what is the total impact on output from Congress' policy?
$35 billion
$87.5 billion
$70 billion
$92 billion
$58.3 billion
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