1. During the last four years, in the island nation of Matania, the following pattern has been observed for national income (Y) and consumption expenditure (C). Year Total Consumption Total Income (Y) Change in Consumption from Change in Income from (C) ($billions) ($billions) previous year (AC) ($billions) previous year (AY) ($billions) 2021 700 1,000 100 200 2022 800 1,200 100 200 2023 900 1,400 100 200 2024 1,000 1,600 100 200 Being peaceful and isolated from the rest of the world, this nation has no need for government, and thus has no taxes. a. What is the marginal propensity to consume (MPC) in Matania? b. What is the savings function in Matania? c. If investors always want to spend $600 billion, or I = 600, what is the equilibrium level of income? At the end of 2024, the inhabitants learn to their dismay that their spiritual leader, DJT, is retiring and going to the mainland to play golf. As a result, the entire nation becomes pessimistic, and i. desired investment is cut in half, or I= 300 ii. the fixed amount consumers are willing to spend [the "a" value in the consumption function ] is also cut in half. d. What is the initial impact of these two changes upon actual investment? e. What is the new equilibrium level of income? Explain why that is an equilibrium? At that equilibrium how much will be invested in inventory accumulation