In an economy, suppose the potential output level is $100 and the current output level is $80.
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Question:
In an economy, suppose the potential output level is $100 and the current output level is $80. To close a GDP gap, a possible policy intervention would be to:
A: Increase income tax
B: Increase reserve ratio
C: Buy bonds from the public
D: Decrease government spending
E: None of the above
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