Macroeconomics

Q1. You are given the following information about the economy of Springland: Autonomous consumption expenditure is $2 billion, and the marginal propensity to consume is 0.75. 1. What is the consumption function? 2. What is the saving function? 3. What is the multiplier? Q2. Some Canadian provinces such as Alberta and Saskatchewan export oil and others such as Ontario and Quebec import oil, which is used in production of goods. Use an AD-AS model to show how an increase in oil price will change GDP and price level in those oil-exporting and oil-importing provinces