7. Suppose you expect the Bank of lClanada (the Canadian central bank) to increase the Canadian money supply by 4.5% per year on average over the next decade. You also expect the Canadian economy to grow by 2.5% per year on average over the next decade. Answer the following. Please be sure to provide a numerical answer to each part. {a} 1What do you expect the average annual Canadian ination rate to be over the next decade? (5 points) (b) If you expect the real interest rate to be 2.5% on average over the next decade, according to the Fisher eect, what do you expect the Canadian nominal interest rate to he on average over the next decade? [5 points) 8. Extra Credit. The US government is considering an increase in government pur- chases. Modeling the United States as a large open classical economy, analyze the effects of this scal policy on real output, consumption, investment, net exports, and the real exchange rate. (5 points)