4. This question explores IS and FX equilibria in a numerical example. a. The consumption function is C = 1.5 + 0.75(Y I). What is the marginal propensity to consume MPC'? What is the marginal propensity to save MPS'? b. The trade balance is NX = 5(1 I/E) 0.25(Y 8) and the investment function is I = 2 101'. Assume government spending is G. Add up the four components of demand and write down the expression for D, aggregate demand. c. Assume forex market equilibrium is given by 1' = ([I/E] I) + 0.10, Where the two foreign return terms on the right are expected depreciation and the foreign interest rate. What is the foreign interest rate? What is the expected future exchange rate? d. Solve for the IS curve: obtain an expression for Y in terms of 1', G, and T. e. Given that interest rate is maintained at 0.15, and that the government maintains a balanced budget. Find an expression for Yin terms of G (or T)