1: Suppose government spending is G = 500 and the government's net taxes revenue is T = 0.20Y. The government has a balanced budget when Y equals:

A: 1000

B: 1500

C: 2000

D: 2500

E: 3000

2: Other things being equal, the SRAS curve will shift upwards (to the left) is

A: an increase in nominal wages.

B: an increase in Labour productivity.

C: a decrease in the price level.

D: a decrease in the cost of capital inputs.

E: an increase in price level.

3:

T = 0.2Y

I = 100

G = 150

Equilibrium national income in this model is:

A: 300

B: 600

C: 750

D: 1200

E: 1500