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Given the following economy Cd-200+ 0.8Y - 500r Id=200-500r a). Suppose that the real interest rate r in equilibrium is 0.2. What is the

Given the following economy Cd-200+0.8Y- 500r Id=200-500r a). Suppose that the real interest rate r in 

Given the following economy Cd-200+ 0.8Y - 500r Id=200-500r a). Suppose that the real interest rate r in equilibrium is 0.2. What is the government spending G of this economy so that its full-employment output Y equals 1000? (hint: Use AE-Y to find G). b). Suppose M=8000 and 1-0.2. Suppose the real balance of money demand is given by L(Y, r)=0.75Y- 250r. What is the price level P in this economy for Y=1000? c). Please draw your IS-LM curves in the graph. Use the graph to illustrate what may happen if the economy has an adversary price shock, such as an oil price hike.

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