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Consider an AD overage of $200 billion, creating an inflationary/expansionary gap. Suppose the MPC is .

Consider an AD overage of $200 billion, creating an inflationary/expansionary gap. Suppose the MPC is .8
(a) How could the government close this gap with tax policy (be specific about size and direction.)
(b) How could the government close this gap with changes in expenditures (be specific about size and direction).

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