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Sagot :
Based on the information given the change in GDP, holding all else constant is a $300 billion increase in GDP.
Using this formula
Change in GDP=Tax increase× Tax multiplier
Where:
Tax increase=$200 billion
Tax multiplier=1.5
Let plug in the formula
Change in GDP=$200 billion×1.5
Change in GDP=$300 billion increase
Inconclusion the change in GDP, holding all else constant is a $300 billion increase in GDP.
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