An economy is described by the following equations C=300+0.5 (Y-T) T=100 = 50 G 100 NX = 50 Y* = 1000 What policy should the government implement to eliminate the output gap (for Y=Y*) Buy bonds O Increase T Decrease G by 60 O Increase G by 60 O Decrease T by 100
An economy is described by the following equations C=300+0.5 (Y-T) T=100 = 50 G 100 NX = 50 Y* = 1000 What policy should the government implement to eliminate the output gap (for Y=Y*) Buy bonds O Increase T Decrease G by 60 O Increase G by 60 O Decrease T by 100
Brief Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter18: Six Debates Over Macroeconomic Policy
Section: Chapter Questions
Problem 2CQQ
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