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If actual real GDP is greater than the equilibrium level of real GDP

  If actual real GDP is greater than the equilibrium level of real GDP (i.e., the aggregate expenditure function
              is below the 45-degree line), how is equilibrium restored?

11.              When aggregate expenditure increases, why is there a multiple expansion of income and real GDP? Trace
              the multiplier effect through the first four rounds when there is an increase in aggregate expenditure of $40
              billion and the marginal propensity to consume is 0.75.

 

 

 

Dec 11 2019 Read more Less More

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