1. An economy is initially at full employment, but a decrease in planned investment spending (a component of autonomous expendit
ure) pushes the economy into recession. Assume the mpc of this economy is 0.75 and that the multiplier is 4. a. How large is the recessionary gap after the fall in planned investment? b. By how much would the government have to change its purchases to restore the economy to full employment? c. Alternatively, by how much would the government have to change taxes?
1 answer:
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Answer:
Because of resources are limited and we must decide
Explanation:
The answer is D
because it tells u the percentage rate of how much u would be getting back
because they are the ones that provide me goods and services.