Government spending will cause the government budget deficit

Reference no: EM131005807

If "the" multiplier is 3, the marginal tax rate is 20% and the money multiplier is 4, a $10b increase in government spending will cause the government budget deficit to

a) increase by $10b

b) increase by $6b

c) increase by $4b

d) decrease by $6b

Reference no: EM131005807

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