ANSWER 4 QUESTIONS PLEASE.

The federal government requires a $40 billion increase in GDP to close the recessionary gap. MPC

for the economy is 0.6. By how much does the government need to increase expenditures in order to

close the gap?

1) The federal government requires a $40 billion increase in GDP to close the recessionary gap. MP0 for the economy is 0.6. By how much does the government need to increase expenditures in order to close the gap? (5 Marks) 2) The provincial government has proposed a plan to increase expenditures by $18 billion, and to increase taxes by $18 billion. What effect will this proposal have on the province's GDP, if the MP0 for the economy is 0.8? (5 Marks) 3) The government is studying two plans to expand the economy. The first plan calls for a tax cut of $16 billion, and the second plan calls for a spending injection of $14.2 billion. The MP3 for the economy is 0.15. Which plan would you recommend to the government? (5 Marks) 4) If Canada maintained a xed exchange rate with the U.S., and had an overvalued currency, the result for Canada would be