Question
Assume an autonomous shock or change to an exogenous economic variable, such as a change in...
Assume an autonomous shock or change to an exogenous economic variable, such as a change in government taxation or spending, the demand for exports, or foreign direct investment inflow into the country. What happens to equilibrium GDP? What is the relationship between the initial change and the overall change to GDP? How does your answer relate to the output multiplier?
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