Problem 7.3: Inflation and Government Expenditures. (10 points) Consider an economy in which government spending is equal to 5 (real) units of output. Suppose that Me = $100. Suppose that the government can only pay for its spending using the inflation tax: it cannot borrow or use direct taxes. Suppose finally that the price level is equal to $10 in period t. Assuming that the classical dichotomy holds (money and inflation have no effect on real output), calculate the amount of money at t+ 1, Mt+1, that the government needs to print in order to finance its spending, as well as the price level in period t + 1