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6. (More difficult) An economy has the following con- sumption funcion: C : 200 + 0.8DI The government budget is balanced, with government purchases and

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6. (More difficult) An economy has the following con- sumption funcion: C : 200 + 0.8DI The government budget is balanced, with government purchases and taxes both fixed at $1,000, Nut exports are $100, Investment is $600, Find equilibrium GDP. What is the multiplier for this economy? If G rises by $100, what happens to Y? What happens to Y If both G and T rise by $100 at the same time

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