Question: How does a decrease in current government purchases, anticipated to be temporary, affect current macroeconomic variables? Describe and illustrate the equilibrium effects in the two-period

How does a decrease in current government purchases, anticipated to be temporary, affect current macroeconomic variables? Describe and illustrate the equilibrium effects in the two-period intertemporal model with investment. To answer this question, draw a diagram that includes the following four figures: 1 (a) The labour market, (b) The production function, (c) The demand for current goods (C + I + G) diagram, and (d) The goods market (The output demand and output supply)

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