3 Two-Period Model with Endogenous Out- put Using the Real Intertemporal Model seen in class, sup- pose the government announces a decrease in future government spending G, while keeping the current spend- ing Go unchanged. 1. 10 How will you expect the decrease in G, to af- fect the N, Na, Y, and Yd curves? Give the driver of each shift. 2. 10 Assuming that the change in Y" is larger than the change in Y'S in magnitude, what are the equi- librium effects on Y, and r*? 3. 10 Taking into account the final adjustment in the labour market, do you think the equilibrium employment will increase or decrease