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The marginal propensity to consume is known to be less than one. If GDP is noticeably below its potential, then an equal increase in both

The marginal propensity to consume is known to be less than one. If GDP is noticeably below its potential, then an equal increase in both government purchases and taxes will likely cause: an increase in real GDP. an increase in the budget surplus. a reduction in the cyclically adjusted budget surplus. no change in real GDP. an decrease in real GDP

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