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  3. 2 given the information below answer the questions that follow...

Question: 2 given the information below answer the questions that follow...

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2. Given the information below, answer the questions that follow. a. b. c. d. What is the equilibrium GDP? Explain why $400 is not the equilibrium. (6 pts) What is the marginal propensity to consume (MPC) in this question? (Explain) (4 pts) Draw a diagram to illustrate the cquilibrium found in part (a). (5 pts) If government purchases increased by $15 and the price level did not change, what would the new equilibrium be? (Show all work) (5 pts) c. How would your answer to part (t) change if the price level did change? (Explain) (5 pts) . Assuming the price level docs not change, by how much would government spending have to change to eliminate the rcal GDP gup given the Qu found in part (a) and Qr 600? (Explain) (5 pls)
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