) This is an inflationary gap which can be closed by decreasing government spending by $_____. Real GDP = 1500, potential GDP = $1200, MPS = .333 5a….
4.) This is an inflationary gap which can be closed by decreasing government spending by $_____. Real GDP = 1500, potential GDP = $1200, MPS = .333 5a.) This is an recessionary gap which can be closed by increasing government spending by $_____. Real GDP = 1500, potential GDP = $1800, MPS = .25 5.) You deposit $500 cash in your checking account. The reserve […]