Consider the following economy:(1) C = 1000 + 0.3 (Y - T)(2) I = 700(3) G = 500(4) T = 400The government decided to run a balanced budget. By how much would taxes have to increase or decrease? (

Consider the following economy:(1) C = 1000 + 0.3 (Y - T)(2) I = 700(3) G = 500(4) T = 400Instead the government decides to change government spending to reach a balanced budget. By how much does the government have to increase or decrease government spending? Write the answer below. If the government decreases spending, write a negative number. Note that in this case you are not touching taxes like in the previous question.

Consider the following economy:(1) C = 1000 + 0.3 (Y - T)(2) I = 700(3) G = 500(4) T = 400Now that you know the new value for taxes from the previous question, i.e. to run a balanced budget. What is the new income of equilibrium?

Consider the following economy:(1) C = 1000 + 0.3 (Y - T)(2) I = 700(3) G = 500(4) T = 400True or false: the government is running a fiscal surplus.

A new government decides to change the government expenditure model so that it represents a higher sensitivity of government spending to GDP changes, suggesting a more aggressive fiscal policy.The government spending now follows the equation:G=500+0.15Y.What are the immediate impacts on economic growth, budget balance and trade balance of this new policy? (4 points)

Consider the following economyC=1000+0.4(Y-T)I=500T=400G=300The current administration wants to expand the economy through fiscal policy. It chooses to change government spending (not touching taxes at all). The target income of equilibrium is 3,000. By how much should the government change spending to achieve that goal? Assume that the other components of autonomous spending remain the same.  (Note that I asked change in government spending, not level. If the change is negative, you should precede your answer by a minus sign. You should figure out the new level of autonomous spending that would achieve that goal and subtract the old level of autonomous spending.)