Please answer question iv using the information from question iii. I believe the three government budget constraints are 1. reducing autonomous taxes by 20 2. reducing government spending by 20 and 3.reducing autonomous taxes by 20 and at the same time reduce government spending by 20. Please show full working out to gain both marks. Thank you.

The economy of Utopia is described by the following equations. C = 10 + 0.8 (Y - T) IP = 20 G = 40 X = 30 T = 10 + 0.2Y M = 0.1Y Y* = 207(iii) Suppose the government is concerned about the size of the budget deficit. It decides to reduce autonomous taxes by 20 and at the same time reduce government spending by 20. Is this an effective fiscal policy response to the fall in exports? Explain your answer. (1 mark) (iv) Use the government budget constraint to analyse each of the above (three) fiscal policies with regard to their effects on the level of public debt. (2 marks)