If M = $1,200 billion and V = 4,then total spending is _______________billion.Then velocity falls to 2 and M rises to $2,000 billion,so that total spending is now _______________ billion,and GDP has _________________.

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Total spending is calculated as M * V. Initially, M = $1,200 billion and V = 4, so total spending is $4,800 billion. When V falls to 2 and M rises to $2,000 billion, total spending becomes $4,000 billion. Since total spending decreased from $4,800 billion to $4,000 billion, GDP has declined.

If M = $1,200 Billion and V = 4,then Total