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The information given are for the four-sector economy of TRIANGLE State. All values are in $ million. Consumption (C) = 40 + 0.8Yd Investment (I)

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The information given are for the four-sector economy of TRIANGLE State. All values are in $ million. Consumption (C) = 40 + 0.8Yd Investment (I) = 45 Taxes (T) = 25 Government spending (G) = 90 Export (X) = 80 Import (M) = 60 a) Derive the consumption function after tax. (2 marks) b) Calculate national income equilibrium for two-sector using Leakage = Withdrawal approach for the above economy. (2 marks) 0) Calculate the government spending multiplier and the tax multiplier. (2 marks) d) If the full-employment income is $1000, what is the problem faced by the above economy? (2 marks) e) Using the multiplier effect: i) determine the change in government spending for the economy to achieve the full employment income. ii) what is the new amount of government spending? (2 marks)

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