This assignment does not use real world data; it involves solving a model similar to that in lectures. We use the following terminology in this part: aggregate income Y and disposable income Ya (= (1-t) Y), consumption function C(Ya), planned investment function I(r), government spending G, and taxation T = tY where t is the marginal tax rate; % denotes the real interest rate in the economy. (Note, r is in percentage points, e.g. r = 2 means the interest rate is 2%. When doing calculations, the interest rate should not simply be inserted in decimal form. For example, if r = 5 then I(5) = 52 - 0.2 x 5 = 51.) Consider a hypothetical economy where: C(Ya) = 58 + 0.6 x Ya I(r) = 52 - 0.2 x r G = 180 t = 0.4 (represents 40%) 1. Using the information above, write out the planned Aggregate Expenditure equation. (Hint: Remember that this takes the form of AE = ....) 2. Write down an expression for the Investment-Savings (IS) Curve. (Hint: First use the AE equation to find an expression for equilibrium Y. Next, remember that the IS equation takes the form of r = ....)