Take the following model for an economy as a starting point: (1)Y= C + I + G

(2) C = z^C + c (Y - T )

(3) I = z ^I + b Y

(4) T = z^T + tY

Assume that the following is given:

z^c = 200, z^I = 200, z^T =150, b = 0.20, c = 0.75, t = 0.30, G = 400

d) What fiscal instruments are there in this model?

e)Explain in words and using the model as a starting point how an increase in taxes of 50 will affect the gross domestic product?

f) Calculate the multiplier for G and z^T. Explain why the G multiplier is greater than the z^T multiplier.