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Suppose That the Current Equilibrium GDP for a Country Is

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Suppose that the current equilibrium GDP for a country is $14.5 trillion and that potential GDP is $14.3 trillion. Will decreasing government purchases by $200 billion or raising taxes by $200 billion restore the economy to potential GDP? Briefly explain why.
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Definitions:

Safety Needs

As identified by Maslow, these are the second level of human needs in his hierarchy, including personal and financial security, health, and well-being, and protection against accidents or harm.

Humanistic Approach

A psychological perspective emphasizing the study of the whole person and their uniqueness, focusing on their potential for personal growth.

Free Will

The concept that human beings have the power to make choices that are not determined by natural or divine forces.

Self-Actualization

The realization or fulfillment of one's talents and potentialities, considered as a drive or need present in everyone.

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