Suppose America is currently experiencing an AD Shortfall of…

Suppose America is currently experiencing an AD Shortfall of $1,600 billion. By how much should the federal government decrease personal income taxes to return the economy to a long-run macro equilibrium? Assume the Marginal Propensity to Consume (MPC) is 0.80.

Suppose America is currently experiencing an AD Shortfall of…

Suppose America is currently experiencing an AD Shortfall of $1,800 billion. By how much should the federal government increase its spending on Unemployment Compensation Benefits to return the economy to a long-run macro equilibrium? Assume the Marginal Propensity to Consume (MPC) is 0.90.