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It is assumed that everything else stays constant. The economy has Consumption $60, Investment spending $80, Government expenditure on goods and services $40, Tax revenues

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It is assumed that everything else stays constant. The economy has Consumption $60, Investment spending $80, Government expenditure on goods and services $40, Tax revenues $70, Exports $50, Imports $30. And marginal propensity to consume is assumed to be 0.6 . When the potential output of the economy (or long run output) is $350, what should be government spending in order to close an output gap? Your

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