Suppose consumption in the economy is described by the following equation. = 50 + 0.7( ) a) What is the government spending multiplier for the economy?

b) What is the tax multiplier for the economy?

c) If the government changes spending by 50, by how much does real GDP and consumption change?

d) If the government wanted to change real GDP by the same amount as part c) using taxes, by how much do they need to change taxes?

e) If autonomous consumption increases briefly explain what would happen to unplanned inventories and real GDP in the economy.