Government purchases multiplier and the net tax multiplier

Reference no: EM1373805

Estimate whether each of following, other things held steady, would lead to an rise, a reduce, or no change in long run aggregate supply,

a. An improvement in technology
b. A permanent decrease in the size of the capital stock
c. An increase in the actual price level
d. An increase in the expected price level
e. A permanent increase in the size of the labor force

Describe the difference between the government purchases multiplier and the net tax multiplier. If the MPC falls, what happens to the tax multiplier?

Reference no: EM1373805

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