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Question 45 (2 points) Listen GDP Taxes GDP after tax Ca Sa Xg M G Ig AE Leakages Injections (or Disposable Income) $115 25 90

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Question 45 (2 points) Listen GDP Taxes GDP after tax Ca Sa Xg M G Ig AE Leakages Injections (or Disposable Income) $115 25 90 77 13 20 19 25 30 133 57 75 $135 25 110 93 17 20 21 25 30 147 63 75 $155 25 130 109 21 20 23 25 30 161 69 75 $175 25 150 125 25 20 25 25 30 175 75 75 $195 25 170 141 29 20 27 25 30 189 81 75 Ca - Consumption after tax Sa - Savings after tax Remember: Tax is a constant value of $25What is the equilibrium level of income in this economy? [Do NOT use a dollar sign in your answer] / \\ {y lfthe federal government decided to reduce \\ J government spending by $15, what affect would this have on GDP? (Use the open economy multiplier.) / Q/ If the federal government decided to x 2 increases taxes by $15, what affect would this have on GDP? (Use Open Economy multiplier.) r \\ / Given the above information, will the Bank of Canada want to further EXPAND the Canadian economy or begin to CONTRACT the economy? [Fill in the blank with either EXPAND or CONTRACT] 5/ Assuming your previous answer is correct, we would expect that the Bank of Canada would achieve this result by BUYING or SELLING bonds? [fill in the blank with either BUYING or SELLING] I I 5/ As a result, will Chartered (Commercial) banks make MORE or FEWER loans? [Fill in the blank with either MORE or FEWER] I I 5/ This will cause the money supply of the nation to INCREASE or DECREASE? [fill in the blank either either INCREASE or DECREASE] I I 45/ As a result, will interest rates INCREASE or DECREASE? [Fill in the blank with either INCREASE 0r DECREASE] I I Q/

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