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NYC NYC
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8 years ago
You are hired by the Bureau of Economic Analogies (BEA) as an economic consultant. The chairperson of the BEA tells you that he believes the current unemployment rate is too high. The unemployment rate can be reduced if aggregate output increases. He wants to know what policy to pursue to increase aggregate output by $200 billion. The best estimate he has for the MPC is 0.6. Which of the following policies should you recommend?
A) reduce the budget deficit by $200 billion
B) increase taxes by $133.33 billion
C) increase government spending by $80 billion
D) reduce taxes by $150 billion and to decrease government spending by $100 billion
Textbook 
Principles of Macroeconomics

Principles of Macroeconomics


Edition: 11th
Authors:
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JesslynJesslyn
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NYC Author
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8 years ago
Thanks for answering Slight Smile
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