Briefly explain the following (2 sentences each maximum - no graphs) in the textbox below:

a. Why must savings always equal investment in a closed economy,

but planned spending and actual spending may differ?(2)

b. How does the relationship of the central bank to the government affect

seignorage?(2)

c. Why are automatic stabilizers both good and bad for an economy?(2)

d. What are the consequences of a balanced-budget rule for government?(2)

e. What is the common element found in the Fischer effect, Ricardian

Equivalence, and the Rational Expectations theory of the business cycle?(2)