2(a). First, briefly describe the concepts of the MP curve, the IS/GT curve, and the LM curve, making sure in your answer to distinguish between the LM and MP curve. Then, under specified assumptions, show both algebraically and graphically that the slope of the LM schedule will reduce if the nominal money supply [in addition to an interest-sensitive money demand] is also interest-sensitive. Use the IS/GT/LM framework to determine the policy implications of an interest sensitive money supply function? (20 points) 2(b). First, briefly describe the significance of \"constrained discretion\" in the \"rules vs discretion\" debate and then, demonstrate your understanding of the \"Cantillon Effect\" and how policy makers can deal with its ramifications. (10 points)