If the government spending multiplier is 2 and government purchases increase by $200 billion, output will increase by

Name: If the government spending multiplier is 2 and government purchases increase by $200 billion, output will increase by
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The government spending multiplier effect indicates how much the GDP (output) will increase for a given increase in government spending. With a multiplier of 2, a $200 billion increase in government spending will lead to a $400 billion increase in output.

If the Government Spending Multiplier Is 2 and Government Purchases