Question

Now, suppose the government were to decrease net taxes by $20 billion without changing the level of government purchases. This would shift the aggregate expenditure line by $ billion. After the multiplier process has run its course, the new equilibrium output will be $ billion, implying that the value of the relevant multiplier is ___.

Answer 1

Answer:

this would shift the aggregate line up by 40 billion implying that the value of the relevent multiplier is 2.

Explanation: