If the MPC is 0.80, and if the goal is to increase real GDP by $200 million, then by how much would government spending have to change to generate this increase in real GDP?

An inflationary gap refers to the gap between real GDP and potential GDP when the level of output is below the level of potential GDP

a. True b. False Indicate whether the statement is true or false

Many government programs, such as unemployment compensation, operate on a deficit during recessions and a surplus during periods of economic expansion. The programs are referred to as

A. automatic stabilizers. B. discretionary fiscal policy. C. Ricardian equivalence. D. Recognition time lag.