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Answer the next 6 questions based on the following information: Starting from the usual full-employment equilibrium,...

Answer the next 6 questions based on the following information: Starting from the usual full-employment equilibrium, what would be the ultimate effect of a reduction in government purchases (G↓) on each of the following economic variables? For each, you should write one of the following responses:  Up, Down, or Same

  1. Potential GDP (Yf)
  2. National Saving (S)
  3. The real interest rate (r)
  4. Investment (I)
  5. Consumption (C)
  6. The price level (P)
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