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8. In order to address its Federal Budget Deficit, the Greek Government increased the tax rate...

8. In order to address its Federal Budget Deficit, the Greek Government increased the tax rate by 7% for the top 50th percentile of household incomes. Included in this law, the government loosened capital requirements for banks lending to start-up businesses in its newly emerging biochemical sector. If all else remains equal, using the concept of Aggregate Demand and Aggregate Supply, what will happen to Greece’s GDP and Price Level?  

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Rahul Sunny answered 7 months ago
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