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Answer the following questions in details bellow: The following equations describe a certain economy. C=100 +0.BY (Consumption function) | = 10-10r (Investment function) G =

Answer the following questions in details bellow:

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The following equations describe a certain economy. C=100 +0.BY (Consumption function) | = 10-10r (Investment function) G = 10 (Government purchases) T = 0.25 (Tax rate) L= Y 100r [ Real money demand) M = 295 ( Real money supply ) Required i.) 15 and LM equations. ii.) R and y pairs at which the two markets are both in equilibrium.Match the following: Match - I Match- II A. The LM curve shifts to the right 1. when the stock of money is increased. B. The LM curve shifts to the left 2. when the stock of money supply is reduced. C. The LM curve shifts to the left if 3. there is an increase in the money demand functi D. The LM curve shifts to the right if 4. there is an decrease in the money demand functProblem 3: Given the following data about the monetary sector of the economy: MJ = 0.4Y - 80r M, = 1200 million Where, Ma is demand for money, Y is the level of income, r is the rate of interest an is the supply of money. Derive the equation for LM curve and give the economic interpretation of this curve

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