Assume that the following model for a country (IS/MP model) is used when answering

A.

The authorities want to ensure that GDP is equal to Ypot at the same time that private consumption is unchanged and net real investment increases by 50 . Calculate how much G must be changed to ensure this (no change in t and the numbers are rounded). 10 a. 10.0 b. 85.4 c. 67.6 d. 75.0 e. None of the options

B.

According to Okun's Law: a. Cyclical unemployment will increase if the negative output gap decreases.

b. Unemployment will rise if economic growth is below 3 per cent.

c. Cyclical unemployment will increase if the positive output gap increases

d. Cyclical unemployment will increase if the negative output gap increases.

e. Cyclical unemployment will increase if the positive output gap decreases.

C.

In the case of a balanced budget change and an unchanged tax rate (T0 - G = 0) will a. The IS curve shift inwards b. The LM curve shifts outwards c. The IS curve remains unchanged d. The UIP curve becomes steeper e. The IS curve shifts outwards

Y=Cp+Ip+G+NX Cp=c(YT)+C0 Ip=I0bi NX=X0eEaY T=T0+tY B=TG G=1500T0=0Ee=97,143t=0,3i=5,0 C0=200I0=1000i=2,0X0=1500a=0,20c=0,8b=100e=5Ypot=5100 Y=Cp+Ip+G+NX Cp=c(YT)+C0 Ip=I0bi NX=X0eEaY T=T0+tY B=TG G=1500T0=0Ee=97,143t=0,3i=5,0 C0=200I0=1000i=2,0X0=1500a=0,20c=0,8b=100e=5Ypot=5100