Suppose an economy is at full-employment equilibrium at a GDP of $25 billion and investment declines...
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Suppose an economy is at full-employment equilibrium at a GDP of $25 billion and investment declines by $4 billion. According to Keynes, this economy will: OA. Quickly self adjust back to full employment. OB. Reach a new equilibrium at $21 billion. OC. Eventually reach a new equilibrium at an output level significantly less than $21 billion. OD. Reach a new equilibrium at a level of output between $21 billion and $25 billion. Suppose an economy is at full-employment equilibrium at a GDP of $25 billion and investment declines by $4 billion. According to Keynes, this economy will: OA. Quickly self adjust back to full employment. OB. Reach a new equilibrium at $21 billion. OC. Eventually reach a new equilibrium at an output level significantly less than $21 billion. OD. Reach a new equilibrium at a level of output between $21 billion and $25 billion.
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