Consider a small open economy described by the following equations: Y = C + I + G + X - M C = 150 + 0.8(Y-T) I = 300 G = 150 X = 70 M = 0.2Y T = 50 + tY where Y is GDP, C is consumption, I is investment, G is government expenditures, X is exports, M is imports, T is taxes, and t is the tax rate on income. If the economy were at its natural level of output (i.e., full employment), GDP would be 1000.

If t = 0.2875 or 28.75 %

What is the marginal propensity to consume and the expenditure multiplier in this economy? Show your work.

Please note, my understanding to MPC is that it is equal to the delta in consumer consumption the delta in consumer income. How are those values calculated?

Thank you in advance.