Answer the questions below for the economy of Motak using the graph below. 1000 900 800 700 600 500 400 300 200 100 Government spending / net taxes 0 The Economy of Motak 400 800 1200 1600 2000 Real GDP NTR G1 Tools G₂ a. If GDP is $1,200 and government spending is G₁, the size of Motak's budget deficit is $ b. If government spending is decreased by the size of the deficit in part (a), draw the new curve labelled G2 in the graphing area above. c. Suppose the multiplier has a value of 2, the new level of equilibrium GDP is $[ d. Motak's deficit at this new level of equilibrium GDP is $ [ billion. billion. billion.

Answer the questions below for the economy of Motak using the graph below. 1000 900 800 700 600 500 400 300 200 100 Government spending / net taxes 0 The Economy of Motak 400 800 1200 1600 2000 Real GDP NTR G1 Tools G₂ a. If GDP is $1,200 and government spending is G₁, the size of Motak's budget deficit is $ b. If government spending is decreased by the size of the deficit in part (a), draw the new curve labelled G2 in the graphing area above. c. Suppose the multiplier has a value of 2, the new level of equilibrium GDP is $[ d. Motak's deficit at this new level of equilibrium GDP is $ [ billion. billion. billion.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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