a} {10 points} Derive Robinson Crusoe's labor supply curve. (Hint: Since G is exogenous, Robinson Crusoe treats it as a constant.) b) (20 points) Suppose the production function in the economy is Y 2 AH and the wage is thus given by w = A as in Problem Set 1. Use this equation, Robinson Crusoe's labor supply curve, the economy's resource constraint andfor the balanced budget equation to solve for output in terms of only G, A, and w. c} {It} points) The government purchases multiplier is dened as the number of dollars that output rises by when government purchases rise by one dollar. (You can assume for simplicity that all the endogenous variables are denoted in dollars.) What is the government purchases multiplier in this economy? [ftp > I], what is the range of values that the government purchases multiplier can take? d) (10 points] Solve for consumption in terms of only G, A, and If). Briey comment on how an increase in government purchases affects consumption. e} (10 points) In one paragraph, discuss whether an increase in government purchases makes Robinson Crusoe better or worse off. In particular, comment on whether Robinson Crusoe is made better off in the case where he does not value the things the government purchases, i.e., if 6 = 0