Q1) The economy is in long-run equilibrium. Aggregate demand then shifts to the left by $50 billion. The government want

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Q1) The economy is in long-run equilibrium. Aggregate demand then shifts to the left by $50 billion. The government want

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Q1) The economy is in long-run equilibrium. Aggregate demand then shifts to the left by $50 billion. The government wants to change its spending in order to avoid a recession. If the crowding-out effect is always half as strong as the multiplier effect, the MPC equals 0.9, and there is no investment accelerator, by how much do the government purchases have to change?
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