1. The government is debating whether to spend $100 billion today to address climate change. They estimate that this current expenditure will reduce future damages by $700 billion, but that these benefits will not be recognized until 100 years from now. a. Conduct a cost-benefit analysis of spending the $100 billion today to avert $700 billion in damages in 100 years, assuming a 5% interest rate. b. An alternative plan would be to invest the $100 billion today at 5% and use the earnings to pay for the damages in 100 years. Would this be a better policy? Explain why or why not. 2. Answer the following questions about Budget Analysis & Deficit Spending a. What is the difference between deficit and debt? b. Why would a government operate with a deficit? What are the costs and benefits of deficit spending? c. Do you think that the government should be allowed (or should allow itself) to accrue large amounts of debt? Should we (the US) focus on or put a higher priority on paying off our debt? Explain in a few sentences