An Economy's Potential Output Is Equal to $22 Billion,and Its

question 19

Multiple Choice

An economy's potential output is equal to $22 billion,and its current output is equal to $20 billion.If the marginal propensity to consume has a value of 0.9,then the government should increase spending by ________ billion to return the economy to the long-run equilibrium.

• A) $0.2
• B) $1.8
• C) $2
• D) $10
• E) $1

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Definitions:

Biologically Based Therapies

This term encompasses a variety of treatments derived from natural sources, such as herbs, foods, and vitamins, often part of complementary and alternative medicine (CAM).

Dietary Supplements

Products taken orally that contain dietary ingredients intended to supplement the diet, such as vitamins, minerals, herbs, amino acids, and enzymes.

Herbal Products

Natural products derived from plants that are used for medicinal, culinary, or cosmetic purposes, often perceived as natural alternatives to synthetic medications.

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An approach to treatment that addresses the individual's physical, mental, and spiritual well-being, rather than focusing solely on physical symptoms.