A. Suppose that Labor Supply is given by N=800 + 10w, and that Labor demand is given by w =1000 - 0.5N.What is the equilibrium w and N?Calculate; show work.Suppose that government states that the w must be equal to 200,how many people would be employed? Calculate and show work.

B. Suppose that Y=4000, C=1250-100r+0.5(Y-T), G=600, T=200, and I=750-150r.Use these values/equations tocalculate the equilibrium level of r, I, S, and disposable income.Show all work.(note that C also depends on Taxes, since it has 0.5*(Y-T) in the equation).

[hint: for question b: once you solve for r*, do not multiply by 100%.Use the value you obtain directly to solve for equilibrium I*, S*, etc.]