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In the questions to follow, use the equations below to put structure on the ISMP model that you are to use in the determination of
In the questions to follow, use the equations below to put structure on the ISMP model that you are to use in the determination of the level of output, Y, and the interest rate, 2'. Planned aggregate expenditures is given by AE=+mpcuT)Y+TIi+E+Ygx(z'z'f)Mmpm(1T)Y All overlined variables represent components of autonomous planned aggregate expenditures. Let if > 0 represent a weighted average of foreign interest rates while having 1 > 0 and {X > 0 indicates that aggregate investment and aggregate exports are responsive to domestic interest rates. Assume that 0 0, 15,, > 0 and z'* > 0
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