Problem
The figure below provides information on the hypothetical country of Balawi. Answer the question below:
a. What is the equilibrium level of GDP? The full employment GDP level? Explain.
b. What is the value of the MPC? The multiplier?
c. What is the value of unplanned change in inventories when real GDP has the following values: 10B? 25B; 35B?
d. If the President of Balawi wants to increase real GDP, would an increase in spending of 1B or a cut in taxes of 1 B be more powerful? Explain briefly.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.