Consider a small country that is closed to trade, so its net exports are equal to zero. The following equations describe the economy of this country in billions of dollars, where C is consumption, DI is disposable income, I is investment, and G is government purchases: C = 100 + 0.75 times DI G = 50 I = 80 Assume that this economy initially has a fixed tax and that net taxes (taxes minus transfer payments) are $40 billion. Disposable income is then (gamma - 40), where gamma is real GDP. Aggregate output demanded is . Suppose the government decides to increase spending by $10 billion without raising taxes. Because the expenditure multiplier is , this will increase the economy's aggregate output demanded by . Now suppose that the government switches to an income tax, which is a type of variable tax, of 5%. Because consumers retain only 95% of each additional dollar of income, disposable income is now 0.95 times gamma. In this case, the economy's aggregate output demanded is . Given an income tax of 5%, the expenditure multiplier is approximately . Therefore, if the government decides to increase spending by $10 billion without raising tax rates, this would increase the economy's aggregate output demanded by approximately . A $10 billion increase in government purchases will have a larger effect on output under a .

2. the external environment (connect)choose whether each example belongs in the general, task, or internal environment.exampleenvironmenta worldwide recession task environment / general environment / internal environmentlocal mothers asking their community grocery store to carry no-salt cheerios-type cereal for their babies task environment / general environment / internal environmentchoose the phrase that best completes the following sentence.the relationship between the task environment and the general environment is best described as: a one-way system: changes in the task environment affect the general environment, but changes in the general environment do not affect the task environment.an open system: changes in the task environment affect the general environment, and changes in the general environment affect the task environment.a one-way system: changes in the general environment affect the task environment, but changes in the task environment do not affect the general environment.a closed system: changes in the general environment do not affect the task environment, and changes in the task environment do not affect the general environment.©bloomberg via getty imagesmanagement in the newsin april 2010, the explosion of british petroleum’s (bp) deepwater horizon oil drilling rig and the accompanying oil spill dramatically changed the external environment in which all oil companies operate. the explosion released more oil than any other accidental spill in history and had a huge impact on the waters and surrounding communities of the gulf coast. the conditions that led to the spill, the attempts to stop the spill, and the clean-up and aftermath of the spill prompted debates in the u.s. senate, concern on wall street, and attention from companies all over the world.match each oil spill event with a specific dimension of the general environment.eventgeneral environment dimensionbp stock prices falling 25% during the first month after the oil spill oil seeping into pelican nesting grounds, which will place the brown pelican back on the endangered species list people moving from louisiana to oklahoma to avoid the effects of the spill