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Let's say the autonomous Investment = $5,000, autonomous consumption = $12000, autonomous
government expenditures = $3,000, autonomous net exports = - $2,000, and the mpe = .8. Now
suppose that potential output is $75,000. What policy might you propose if you want the
economy to return to potential output (gdp)?
Question 10 options:
Nothing, this is equilibrium gdp
Increase Government spending $5,000
decrease Government spending $30,000
decrease Government spending $3,000
Nothing, this is equilibrium gdp
Increase Government spending $5,000
decrease Government spending $30,000
decrease Government spending $3,000

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Lets say the autonomous Investment = $5,000, autonomous consumption.pdf

  • 1. Let's say the autonomous Investment = $5,000, autonomous consumption = $12000, autonomous government expenditures = $3,000, autonomous net exports = - $2,000, and the mpe = .8. Now suppose that potential output is $75,000. What policy might you propose if you want the economy to return to potential output (gdp)? Question 10 options: Nothing, this is equilibrium gdp Increase Government spending $5,000 decrease Government spending $30,000 decrease Government spending $3,000 Nothing, this is equilibrium gdp Increase Government spending $5,000 decrease Government spending $30,000