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Consider the real intertemporal model with investment. Suppose the government increases government purchases G. Carefully explain using diagrams and math the size of the partial

Consider the real intertemporal model with investment. Suppose the government increases government purchases G. Carefully explain using diagrams and math the size of the partial government expenditure multiplier assuming the consumption function is linear. In a diagram

show the total government expenditure multiplier and carefully comment on its

magnitude. What does the Ricardian equivalence theorem have to say about

the size of the government expenditure multiplier?

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