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The balanced budget multiplier suggests that government's fiscal policy does not have any effect on the economy. Do you agree with the statement? Assume that
The balanced budget multiplier suggests that government's fiscal policy does not have any effect on the economy. Do you agree with the statement? Assume that in a hypothetical economy,the government increases spending by Rs1,000 and also increases taxes by Rs1,000, and the mpc for the economy is 0.8.Under what conditions can this economy have the value of the balanced budget multiplier equal to one. 1.Show your calculations and explain
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