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Initially, the economy is in long-run equilibrium. Aggregate demand then shifts leftward by $50 billion. The government wants to increase its spending in order to avoid a recession. If the crowding-out effect is always half as strong as the multiplier effect, and if the MPC equals 0.8, then by how much do government purchases have to increase in order to offset the $50 billion leftward shift?
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A mental health condition characterized by an intense, persistent fear of being watched and judged by others.
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A complex and usually unpleasant emotional response to isolation or lack of companionship.
Psychological Disorders
Mental disorders characterized by patterns of behavior or thought that are both dysfunctional and distressing.
Poverty Line
A threshold set by an authority that delineates the minimum level of income required to afford basic living expenses, varying by country and context.
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