Assume, the Chinese government will finance the investment of $25,000,000 in healthcare sector (as mentioned in the previous) e-mail through increase in taxes as well as by borrowing money. They will increase taxes by $20 million and borrow $5 million from the Russian government. We still assume that the leakage from the injection is $2,500,000. Given this information, what is the negative impact of taxes in the economy?
Question 35 options:
a)
Output will go DOWN by $1,800,000,000
b)
Output will go down by $25,000,000
c)
Output will go UP by $1,800,000,000
d)
Output will go down by $20,000,000