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17 October, 19:22

Now, suppose the government were to decrease net taxes by $20 billion without changing the level of government purchases. This would shift the aggregate expenditure line by $ billion. After the multiplier process has run its course, the new equilibrium output will be $ billion, implying that the value of the relevant multiplier is ___.

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  1. 17 October, 19:32
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    this would shift the aggregate line up by 40 billion implying that the value of the relevent multiplier is 2.
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