Question: 1. Explain how a temporary increase in government spending will affect Saving and Investment in a small open economy and a closed economy. (INCLUDE GRAPH

1. Explain how a temporary increase in government spending will affect Saving and Investment in a small open economy and a closed economy. (INCLUDE GRAPH PLEASE)

2. How is the supply of labour affected by an increase in the real wage? (INCLUDE GRAPH PLEASE)

3. Using the IS-LM-FE model of a closed economy, explain the effect of an equivalent decrease in government spending and taxes on GDP, the real interest rate, and the price level. (INCLUDE GRAPH PLEASE)

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