Question
Suppose over the course of 2021the following percentages emerge:Out of every dollar earned .2711 cents is paid in taxes; .0283 is saved; .1839 is spent
Suppose over the course of 2021the following percentages emerge:Out of every dollar earned .2711 cents is paid in taxes; .0283 is saved; .1839 is spent on imported goods.If that year the recessionary GDP gap is $712.93 billion, a __________ economist would recommend _________ government spending by ____ because the multiplier is:
a.Keynesian; increasing; $344.58 billion; 2.069
b.Keynesian; increasing; $712.93 billion; greater than one
c.Classical; not changing; any amount; a less effective policy tool than wage and price controls.
d.Monetarist; decreasing; $2.069 billion; an ineffective way to boost aggregate demand.
e.B and D only
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