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Suppose the economy's multiplier is 5. Other things equal, a $5 billion decrease in government expenditures on national defense will cause equilibrium GDP to decrease
Suppose the economy's multiplier is 5. Other things equal, a $5 billiondecreasein government expenditures on national defense will cause equilibrium GDP to
- decrease by $50 billion.
- increase by $25 billion.
- decrease by $5 billion.
- remain unchanged.
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