The Deepest the Output Gap Was During the Great Recession

question 5

Essay

The deepest the output gap was during the Great Recession was -7.46 percent in July 2009. Many believe that the multiplier used was 1.5. If this is true, what is
? What is
if the multiplier used was 1.25? What would the percent change in government expenditure be to close this gap, assuming monetary policy is not being used?

---

Definitions:

Master Switch

A principal electrical switch that controls the power to multiple circuits or a large part of an electrical system.

Electrical Power

The rate at which electrical energy is transferred by an electric circuit, usually measured in watts, and it dictates the energy supplied or consumed by electrical devices.

Engine Control Module

An electronic control unit that manages various engine functions, optimizing performance, emissions, and fuel economy.

Fault

A defect in a system that can cause it to fail or perform suboptimally.