Solved: Suppose that the government increases expenditures by150, Macroeconomics

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Suppose that the government increases expenditures by150

Suppose that the government increases expenditures by$150 billion while increasing taxes by $150 billion. Suppose that the Marginal Propensity to Consume(MPC) is .80 and theta there are no crowding out or accelerator effects.

What are the combined effects of these changes?

Why is the combined change not equal to zero?

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Macroeconomics: Suppose that the government increases expenditures by150

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Macroeconomics: Suppose that the government increases expenditures by150

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