(1)

At equilibrium; Y = C + I + G + X - M

=> Y = 1000 + 0.8YD + 325 + 225 + 450 - 0.1Y

=> Y = 2000 + 0.8 (Y - T) - 0.1Y

=> Y = 2000 + 0.8(Y - 0.25Y) -0.1Y

=> Y = 2000 + 0.8(0.75Y) - 0.1Y

=> Y = 2000 + 0.6Y - 0.1Y

=> Y = 2000 + 0.5Y

=> Y -0.5Y = 2000

=> 0.5Y = 2000

=> Y = (2000 / 0.5)

=> Y = 4000

Equilibrium level of Y is 4000.

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M =0.1Y

=> M = 0.1(4000)

=> M = 400

At equilibrium level of Y, the import is 400

and

At equilibrium level of Y, the export is 450

The export is higher than import by 50. It means the economy is a net exporter of 50.

Answer: Option (C)

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(2)

Government runs a budget surplus if taxes is higher than government spending.

i.e. T > G

=> 0.25Y > 225

=> Y > (225 /0.25)

=> Y > 900

It means the government will run a budget surplus if GDP is greater than 900.

Answer: Option (C)