Question 3 (5 Points) The consumption and investment in a closed economy are as follows: C = 300 + 0.8(Y T) 200,. ID = 258.5 2507' Taxes and government spending are as follows: T = 20+0.5Y G = 50 'r is the interest rate in the loanable funds market. a. (1 point) For any level of output, Y, nd an equation that gives the supply curve of loanable flmds. b. (1 point) Suppose Y = 950. Determine the equilibrium level of investment, saving, con- sumption in this economy. 0. (2 points) Now suppose there is also a change in the government spending so, G rises from 50 to 72.5. Y is still same, which is 950. Calculate the new equilibrium interest rate and the amount of investment. Draw a graph that clearly illustrates the changes in the interest rate and the amount of investment. d. (1 point) Calculate the marginal propensity to consume in this economy