Consider planned aggregate expenditure model: planned investment, I = $2 trillion; government spending G = $4 trillion; Taxes are equal to $8 tillion; the consumption function, C(Y-T)= $4 trillion + 0.9(Y-T).

1. 1. What is the equilibrium level of output?
   2. If GDP initially started at $34 trillion: What would happen to inventories and output?
   3. At the equilibrium level of output: what are total consumption and savings?
   4. If government spending increased to $5 trillion, what would be the new level of equilibrium output? What is the government spending multiplier
   5. Holding everything else constant (and assuming government spending is $4 trillion), if planned investment increased to $3 trillion what would be the new equilibrium level of output?