In an article regarding Bangladesh's economy, the author suggests that the government ..."[g]ive do tax breaks on investment dollars. Give a tax break to R&D [research and development]. Give a tax b on donations to educational institutions. "
HYPERLINK "http://www.groundreport.com/" www.groundreport.com, March 24, 20
Suppose the multiplier in Bangladesh is 2. If the government enacts the proposed policies and _ aggregate expenditure in the short run.
A) autonomous expenditure decreases by $10; decreases by $5 billion.
B) induced expenditure increases by $5 billion; increases by $10 billion.
C) autonomous expenditure increases by $10 billion; increases by $20 billion.
D) equilibrium expenditure increases by $8 billion; increases by $16 billion.
Correct Answer:
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