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please fill in the blanks with one of the options in the below box. Consider an economy where the natural rate of unemployment rate is
please fill in the blanks with one of the options in the below box.
Consider an economy where the natural rate of unemployment rate is 5% and real GDP at full employment is $3.50 billion. Consumers' spending behavior is described by the equation: C = 150 + 0.75DI, while firms' investment behavior is described by the equation I = 300 + 0.2Y - 750r. Trade is allowed and currently imports are defined by the equation IM = 250 + 0.2Y. In 2016, exports is fixed at $300 million and government spending is fixed at $800 million. Furthermore, in the same year, tax rate is 20% and the interest rate is 8%. (Question 5 of 15) Describe the economy in 2016. (complete the sentences below) In 2016, the economy is in a recessionary gap * gap, and unemployment is greater than * the natural rate of unemployment. The government is operating with budget deficit * and the international segment of the economy has trade deficitan inflationary gap '1" a recessionary gap balanced budget balanced trade account budget deficit budget surplus greater than less than the same as trade deficit trade surplusStep by Step Solution
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