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Suppose a government decreases its purchases by $200 billion. If the government spending multiplier is...

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Accounting

Suppose a government decreases its purchases by $200 billion. If the government spending multiplier is 2, then
A. AD will shift leftward by $400 billion.
B. AD will shift leftward by $100 billion.
C. AD will shift leftward by $200 billion.
D. AD will shift rightward by $400 billion.

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