If GDP is $800 and government spending is G1, the size of Motak's budget deficit is $ billion.   b. If government spending is decreased by the size of the deficit in part (a), draw the new curve labelled G2 in the graphing area above.   c. Suppose the multiplier has a value of 3, the new level of equilibrium GDP is $ billion.   d. Motak's deficit at this new level of equilibrium GDP is $ billion.

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a. If GDP is $800 and government spending is G1, the size of Motak's budget deficit is $ billion.

 

b. If government spending is decreased by the size of the deficit in part (a), draw the new curve labelled G2 in the graphing area above.

 

c. Suppose the multiplier has a value of 3, the new level of equilibrium GDP is $ billion.

 

d. Motak's deficit at this new level of equilibrium GDP is $ billion.

Answer the questions below for the economy of Motak using the graph below.
Government spending / net taxes
400
350
300
250
200
150
100
50
The Economy of Motak
(600, 375)
200 400 600 800 1000 1200 1400
Real GDP
NTR
G1
Tools
/
G2
@
Transcribed Image Text:Answer the questions below for the economy of Motak using the graph below. Government spending / net taxes 400 350 300 250 200 150 100 50 The Economy of Motak (600, 375) 200 400 600 800 1000 1200 1400 Real GDP NTR G1 Tools / G2 @
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